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LAWS
OF THE
STATE OF DELAWARE
PASSED AT THE
One Hundred and Second
Session of the General Assembly
COMMENCED AND HELD AT DOVER
On Tuesday, January ', A. D.' 9 2 9
AND
IN THE YEAR OF THE INDEPENDENCE OF THE UNITED STATES
THE ONE HUNDREDTH AND FIFTY- THIRD
VOLUME XXXVI
J. LAURANCE BANKS, INCORPORATED
WILMINGTON, DELAWARE
1929

LAWS
OF THE
STATE OF DELAWARE
PASSED AT THE
One Hundred and Second
Session of the General Assembly
COMMENCED AND HELD AT DOVER
On Tuesday, January ',A.D.' 9 2 9
AND
IN THE YEAR OF THE INDEPENDENCE OF THE UNITED STATES
THE ONE HUNDREDTH AND FIFTY-THIRD
VOLUME XXXVI
J. LAURANCE BANKS, INCORPORATED
WILMINGTON, DELAWARE
1929
1
1
1
1
LAWS of DELAWARE
TITLE ONE
Construction of Statutes
CHAPTER 1
AMENDMENT TO CONSTITUTION
AN ACT proposing an Amendment to Article Two of the Consti-tution
of the State of Delaware authorizing the General
Assembly to empower municipal corporations, other than
Counties, to adopt Zoning Ordinances.
Be it enacted by the Senate and House of Representatives of
the State of Delaware in General Assembly met (two-thirds of
each branch thereof concurring therein):
Section 1. That Article Two of the Constitution of the
State of Delaware be amended by adding at the end thereof a new
section to be known as Section 25, as follows :
Section 25. The General Assembly may enact laws under
which municipalities, other than counties, may adopt zoning
ordinances limiting and restricting to specified districts, and regu-lating
therein buildings and structures, according to their con-struction,
and the nature and extent of their use, and the exercise
of such authority shall be deemed to be within the police power
of the State.
Approved March 19,1929.
3
TITLE TWO
Jurisdiction and Property
of the State
CHAPTER 2
PUBLIC LANDS
AN ACT relating to the Public Lands of the State of Delaware and
the supervision and control thereof.
Be it enacted by the Senate and House of Representatives of
the State of Delaware in General Assembly met:
Section 1. On and after July 1, 1929, the Public Lands of
the State of Delaware, as ascertained in regard to location, sur-veyed
and plotted under the supervision and direction of the
Public Lands Commission, created in accordance with the pro-visions
of Chapter 5, Volume 27, Laws of Delaware, shall be
under the supervision and control of the State Highway Depart-ment,
which Department is hereby authorized and empowered
to care for the said Public Lands and all powers given to said
Public Lands Commission shall thereafter be exercised by the
said Department.
Section 2. The State Highway Department is further
authorized to survey such of the said Public Lands that may not
have been surveyed, plotted and recorded in the office of the
Recorder of Deeds in the County in which any such Lands may
lie ; to survey and lay off such Public Highways through any
such Lands as they may deem advisable and for the public good;
to supervise the sale of any material, product or thing which
may grow or may be grown upon any such lands ; to divide said
Public Lands into tracts of fifty (50) acres, or less ; and to sell
such tracts, or any part of any such tracts, as shall be deemed
advisable to sell.
4
LAWS OF DELAWARE 5
PUBLIC LANDS
Section 3. The State Highway Department is also autho-rized
and empowered to construct any road or roads leading to
or through any such Public Lands which are under the super-vision
and control of the said Department; to make plans and
specifications for the construction of such road or roads and to
secure bids for the construction of the same ; to enter into con-tract
or contracts for the construction of such road or roads as
may be deemed wise; and to pay the costs of the plans, specifica-tions
and construction work incident to the building of such road
or roads out of any monies to the credit of said Department in
the State Treasury.
Section 4. The State Highway Department, together with
the Governor of this State, is hereby authorized and empowered
to execute and deliver a good and sufficient deed to any part of
said Public Lands of the State of Delaware, and to place upon
the sale of such lands a restriction requiring the expenditure
by any person or persons purchasing the same of a certain amount
of money upon any tract sold to them, or to require any other
conditions which the said Department may deem advisable for
the public good. Whoever shall purchase any of the said Public
Lands under any restrictions or conditions of the said Depart-ment,
and shall fail for a period of five (5) years to comply with
the restrictions or conditions mentioned in the Deed of Grant
from said Department, shall forfeit said Lands to the State of
Delaware, and the title to same shall thereafter rest in the State.
Section 5. That the State Highway Department may be
enabled to carry out the provisions of this Act, all monies kept
in the hands of the Public Lands Commission shall be placed in
the State Treasury to the credit of the State Highway Depart-ment,
and any monies, other than appropriated by the General
Assembly, realized from the care and supervision of Public Lands
of this State shall be deposited with the State Treasurer for the
use of the said State Highway Department in carrying out the
provisions of this Act; provided, however, no public money shall
be expended under the provisions of this Act on any road or roads
leading to or through any Public Lands of this State with pri-
6 LAWS OF DELAWARE
vately owned lands abutting thereon unless and until the owners
of said abutting lands shall have reached or entered into an agree-ment
with the said Highway Department as to whether or not
a contribution toward the cost of such road or roads shall be
made by said owner of such lands.
Section 6. All Acts or parts of Acts inconsistent with this
Act are hereby repealed, in so far as the inconsistencies exist.
Approved April 18, 1929.
PUBLIC LANDS
LAWS OF DELAWARE 7
CHAPTER 3
STATE HOUSE AND STATE OFFICES
AN ACT to amend Chapter 4 of the Revised Code of the State of
Delaware in relation to the State House.
Be it enacted by the Senate and House of Representatives of
the State of Delaware in General Assembly met:
Section 1. That Section 1 of Chapter 4 of the Revised Code
of the State of Delaware, being Section 16 of the Revised Code of
1915, be amended by striking out all of said Section 1 and by
inserting in lieu thereof the following:
Section 1. On the Second Tuesday of February, 1929, or
at such time thereafter as the approval of this Act will permit,
and every four years thereafter on the second Tuesday of Febru-ary,
the Governor shall appoint a Custodian of the State House,
who shall hold office for the term of four years or until a successor
is duly appointed and qualified. Before entering upon the duties
of this office, the said Custodian shall take the oath of office pre-scribed
by the Constitution and give a bond to the State in the
sum of Two Thousand Dollars, with sureties approved by the
Governor, conditioned for the faithful performance of the official
duties and the safe keeping of all State property under his care ;
such oath and bond shall be filed in the office of the Secretary of
State.
Section 2. That Section 2 of Chapter 4 of the Revised Code
of the State of Delaware, being Section 17 of the Revised Code of
1915, be amended by striking out all of said Section 2 and by
inserting in lieu thereof the following:
Section 2. The Custodian of the State House shall have
general charge of the State House and Administration Buildings
and shall see that the same are properly cared for. He shall
assign all rooms in the State House and Administration Buildings
by and with the consent of the Governor for such uses and pur-poses
as they may designate. At any time, when the said Cus-
LAWS OF DELAWARE
STATE HOUSE AND STATE OFFICES
todian shall fail to perform the duties of the office, the Governor
may remove such official and appoint some competent person to
fill the unexpired term.
Section 3. That Section 3 of Chapter 4 of the Revised Code
of the State of Delaware, being Section 18 of the Revised Code
of 1915, be amended by striking out all of said Section 3 and by
inserting in lieu thereof the following:
Section 3. The Custodian of the State House shall ap-point
two or more persons, one of whom shall be known as the
Chief Janitor for the State Buildings, who shall hold office at the
pleasure of the said Custodian. He shall direct the work of the
said Janitor, whose duty it shall be to care for the property be-longing
to the State, to keep clean and in good order all the rooms,
offices, apartments, library and furniture, halls, stairways and
cellars in said buildings, to attend to the heating of same, and to
look after the pavements and grounds attached thereto, and to
perform the duties and to do any and all things directed to be done
by the Custodian, which may be incident to the office of Janitor.
The Custodian and Janitors, for the purpose of enforcing this
Section, shall be clothed with all the powers of a police officer of
the Town of Dover, De/aware.
Section 4. That Section 4 of Chapter 4 of the Revised Code
of the State of Delaware, being Section 19 of the Revised Code of
1915, be amended by striking out all of said Section 4 and by in-serting
in lieu thereof the following:
Section 4. The Custodian of the State House shall re-ceive
an annual salary of Fifteen Hundred Dollars ($1,500.00),
and is authorized and empowered to draw upon the State Treas-urer
at the end of each month for the same. The Chief Janitor
shall be paid for his services a monthly salary of Ninety Dollars
($90.00) and the others shall receive Eighty Dollars ($80.00) per
month for their services, such monies to be paid by the State
Treasurer on warrants signed by the said Custodian. There shall
also be allowed to defray the expenses incident to the care of
LAWS OF DELAWARE 9
STATE HOUSE AND STATE OFFICES
State property such amounts as may from time to time be ap-propriated
in the Budget Appropriation Bill.
Section 5. That Section 5 of Chapter 4 of the Revised Code
of.the State of Delaware, being Section 20 of the Revised Code of
1915, be amended by striking out all of said Section 5 and by
inserting in lieu thereof the following:
Section 5. The Custodian of the State House shall make
a written report to the State Treasurer every six months as to
the condition of the State property in his care and of the manner
in which the janitors are performing the duties incumbent upon
them. Should any report show the need of repairs to the build-ings
or improvement to the grounds, or that the janitors are not
performing the duties of their respective offices faithfully, the
State Treasurer shall bring such matter to the attention of the
Board of State Repairs or to the Governor, as the condition may
warrant.
Section 6. That Section 6 of Chapter 4 of the Revised Code
of the State of Delaware, being Section 21 of the Revised Code of
1915, be amended by striking out all of said Section 6 and by
inserting in lieu thereof the following:
Section 6. The Custodian of the State House shall keep
the State House and Administration Buildings open each day,
except Sundays and legal holidays, from eight o'clock A. M. to
five o'clock P. M., with the exception of Saturdays, when the said
buildings shall be closed at one o'clock P. M., provided, however,
that during the period of the sessions of the General Assembly,
the State House shall be open from eight o'clock A. M. to ten
o'clock P. M. on the days that sessions are being held.
Section 7. That Section 7 of Chapter 4 of the Revised Code
of the State of Delaware, being Section 22 of the Revised Code
of 1915, be amended by striking out all of said Section 7 and by
inserting in lieu thereof the following:
* So enrolled.
10 LAWS OF DELAWARE
STATE HOUSE AND STATE OFFICES
22. Section 22.* The Custodian of the State House is hereby
authorized to appoint during any biennial or special session of
the General Assembly a night watchman for the State House,
who shall hold office for or during the said session, unless sooner
removed by the Custodian. It shall be the duty of such night
watchman to go on duty at seven o'clock P. M. and remain on
duty until seven o'clock A. M., and to permit no one to enter the
State House between the hours of ten o'clock P. M. and seven
o'clock A. M., except State officials, their representatives and
persons accompanying them. The compensation of said night
watchman shall not exceed the sum of Five Dollars per diem of
actual service during the session of the General Assembly.
Approved April 17, 1929.
LAWS OF DELAWARE 11
CHAPTER 4
STATE LIBRARY
AN ACT to amend Chapter 5 of the Revised Code of the State of
Delaware in relation to the State Library.
Be it enacted by the Senate and House of Representatives of
the State of Delaware in General Assembly met:
Section 1. That Section 1 of Chapter 5 of the Revised Code
of the State of Delaware, being Section 23 of the Revised Code
of 1915, be amended by striking out all of said Section 1 and by
inserting in lieu thereof the following:
Section 1. On the second Tuesday of February in the
year A. D. 1899, and every two years thereafter, the Governor
shall appoint a State Librarian, who shall hold office for a term of
two years or until a successor is duly appointed and qualified.
Before enlisting upon the duties of the office, the said Librarian
shall take the constitutional oath of office and give a bond to the
State in the sum of Two Thousand Dollars, with surety approved
by the Governor, conditioned for the faithful performance of
official duties and the safe keeping and delivery to a successor
of all property belonging to the State Library ; such oath and bond
shall be filed in the office of the Secretary of State.
'Section 2. That Section 2 of Chapter 5 of the Revised Code
of the State of Delaware, being Section 24 of the Revised Code of
1915, be amended by striking out all of said Section 2 and by in-serting
in lieu thereof the following:
Section 2. The State Librarian shall receive for services
rendered the State of Delaware a salary of Twelve Hundred Dol-lars
($1,200.00) per year, and to be paid monthly by the State
Treasurer from monies appropriated for such purposes. There
shall also be allowed to defray the current expenses of the State
Library a sum not in excess of Two Hundred and Seventy Five
Dollars to be drawn from the State Treasury from funds appropri-ated
for such purpose.
12 LAWS OF DELAWARE
STATE LIBRARY
Section 3. That Section 3 of Chapter 5 of the Revised Code
of the State of Delaware, being Section 25 of the Revised Code of
1915, be amended by striking out all of the said Section 3 and
by inserting in lieu thereof the following:
Section 3. The State Library shall consist of the books,
pamphlets, maps, charts, and documents of every kind, including
all books, pamphlets and papers received from the Medical So-cieties
of Delaware, together with such others as may hereafter
be acquired by gift, purchase, exchange or otherwise ; provided
that there shall always be kept in said library not less than
twenty-five copies of the Duke of York's Records for the same
uses and purposes for which other books are or may hereafter
be kept.
Section 4. That Section 4 of Chapter 5 of the Revised Code
of the State of Delaware, being Section 26 of the Revised Code
of 1915, be amended by striking out all of said Section 4 and by
inserting in lieu thereof the following:
Section 4. The State Librarian shall keep a complete
record of all books, pamphlets, documents and papers received
for the State Library and properly label the same. The said
Librarian shall also keep a complete record of all books taken
from said library and require the return of same within the time
set by the rules and regulations governing the library as formu-lated
by the Librarian by and with the consent of the Judges of
the Supreme Court. In case of any person taking books from
the Library shall fail to return the same within the time set by
the rules and regulations aforesaid, such person shall be fined
by the Librarian the sum of Ten Cents per book for each and
every week such book or books are so unlawfully retained.
Section 5. That Section 5 of Chapter 5 of the Revised Code
of the State of Delaware, being Section 27 of the Revised Code
of 1915, be amended by striking out all of the said Section 5 by
inserting in lieu thereof the following:
LAWS OF DELAWARE 13
STATE LIBRARY
Section 5. The State Librarian shall annually, under
the direction of the Judges of the Supreme Court, expend a sum
not exceeding Five Hundred Dollars for the purpose of purchas-ing
law books. Said sum shall be paid to said Librarian by the
State Treasurer, out of moneys appropriated for that purpose,
upon the presentation of the approval, in writing, of the Judges
of the said Supreme Court or a majority of them.
Section 6. That Section 6 of Chapter 5 of the Revised Code
of the State of Delaware, being Section 28 of the Revised Code
of 1915, be amended by striking out all of the said Section 5 and
by inserting in lieu thereof the following:
Section 6. The State Librarian is authorized to dispose
of by way of sale or exchange such books in the State Library
as are not needed and of which there are a number of copies,
upon approval of any two Judges of the Supreme Court. Any
money derived from the sale of such books shall be deposited
with the State Treasurer, who is authorized to keep a separate
account of such receipt, said receipt to be expended for other
books needed in the said Library. The State Treasurer is author-ized
and directed to pay bills chargeable against the fund, upon
presentation of same by the State Librarian having the approval
of any two Judges of the Supreme Court, and in accordance with
the law governing the approval and payment of bills by the State
Treasurer.
Section 7. That Section 7 of Chapter 5 of the Revised Code
of the State of Delaware, being Section 29 of the Revised Code
of 1915, be amended by striking out all of said Section 7 and
inserting in lieu thereof the following:
Section 7. The State Librarian, upon the receipt of
Judicial Reports and Chancery Reports to be deposited in the
Library by law, shall transmit one copy of each of said reports to
the Library of each State and Territory, one copy to the Congres-sional
Library, one copy to the New Castle County Law Library,
one copy to the University of Delaware, one copy to the Historical
Society of the State of Delaware, and one copy to the Library
of the Municipal Court of the City of Wilmington.
14 LAWS OF DELAWARE
STATE LIBRARY
Section 8. That Section 8 of Chapter 5 of the Revised Code
of the State of Delaware, being Section 30 of the Revised Code
of 1915, be amended by striking out all df said Section 8 and by
inserting in lieu thereof the following:
Section 8. The State Librarian shall have the custody
of stationery, postage and supplies purchased for the use of the
General Assembly and shall distribute the same in accordance
wjth the law provided for such distribution.
Section 9. That Section 9 of Chapter 5 of the Revised Code
of the State of Delaware, being Section 31 of the Revised Code
of 1915, be amended by striking out all of said Section 9 and by
inserting in lieu thereof the following:
Section 9. On or before the first Tuesday in January,
of each year in which the General Assembly convenes in regular
session, the State Librarian shall make a report to the Governor,
in which shall be set forth the condition of the State Library,
the number of books received, the number of books lost, the
fines levied and collected in the intervening period, and all other
things concerning the library that may be deemed proper.
Section 10. That Section 10 of Chapter 5 of the Revised
Code of the State of Delaware, being Section 32 of the Revised
Code of 1915, be amended by striking out all of said Section 10
and by inserting in lieu thereof the following:
Section 10. The State Library shall be open from nine
o'clock A. M. to twelve o'clock noon, and from one o'clock P. M.
to four o'clock P. M. on each day, excepting Sundays and legal
holidays and the further exception of Saturdays, when the library
shall be closed at noon ; provided that during the period of the
sessions of the General Assembly, the library shall be open from
nine o'clock A. M. to ten o'clock P. M. on the days the General
Assembly is in session.
Section 11, That Section 11 of Chapter 5 of the Revised
Code of the State of Delaware, being Section 33 of the Revised
Code of 1915, be amended by striking out all of said Section 11
and by inserting in lieu thereof the following:
LAWS OF DELAWARE 15
STATE LIBRARY
33. Section 11. At any time when the State Librarian shall
fail to perform the duties as hereinbefore prescribed, then and
in that event, the Governor may remove said Official and appoint
some competent person to fill the unexpired term.
Section 12. That Section 12, Section 13, Section 14, and
Section 15 of Chapter 5 of the Revised Code of Delaware, being
Sections 34, 35, 36 and 37 of the Revised Code of 1915, be and the
same are hereby repealed.
Approved April 17, 1929.
16 LAWS OF DELAWARE
CHAPTER 5
STATE LIBRARIAN
AN ACT authorizing the State Librarian to deliver certain State
Publications to the Library of the University of Delaware.
Be it enacted by the Senate and House of Representatives of
the State of Delaware in General Assembly met:
Section 1. That the State Librarian is hereby authorized
to deliver to the Library of the University of Delaware a full
set of the Volumes of the Laws of Delaware, complete to date ;
also copies of the Legislative proceedings of the two Houses of
the General Assembly now on hand and not in current use; and
also copies of the Laws of Delaware, and of the Legislative pro-ceedings,
that are published from time to time in the future;
and provided further, that any publications delivered under the
provisions of this Act shall, at the written request of a majority of
the Judges of the Supreme Court of this State, be returned to the
State Librarian.
Approved March 19, 1929.
TITLE THREE
State Revenue and Supplies
CHAPTER 6
STATE REVENUE
FRANCHISE TAX
AN ACT to amend Article 8 of Chapter 6 of the Revised Code of
the State of Delaware relative to the State Revenue from
Domestic Corporations.
Be it enacted by the Senate and House of Representatives of
the State of Delaware in General Assembly met:
Section 1. That Article 8 of Chapter 6 of the Revised Code
of the State of Delaware be and the same is hereby amended by
striking out Section 65, being Section 102 of the Revised Code
of 1915, and by inserting in lieu thereof the following:
102. Section 65. Franchise Taxes ; Payable Annually; What
Corporations Subject to Tax; What Corporations Exempted from
Tax:Every telegraph, telephone or cable company, every elec-tric
company organized for the production and / or distribution
of light, heat, or power, every company organized for the purpose
of producing and /,or distributing steam, heat, or power, every
company organized for the purpose of the production and / or
distribution and / or sale of gas, every parlor, palace, or sleeping
car company, every express company not owned by a railroad
company, every pipe line company, every life insurance company,
every other insurance company of whatever kind, and every cor-poration
now existing or hereafter to be incorporated under the
provisions of the Laws of the State of Delaware, shall pay an
annual tax, for the use of the State, by way of license for the
17
18 LAWS OF DELAWARE
FRANCHISE TAX
corporate franchise as hereinafter mentioned ; provided, however,
no such tax shall be paid by any railroad, railway or canal cor-poration
or any express company owned by a railroad company,
or any banking corporation, savings bank or building and loan
association, or any corporation for drainage and reclamation of
low lands, or religious corporation, or purely charitable or edu-cational
association, or any company, association, or society,
which, by its certificate of incorporation, shall have for its object
the assistance of sick, needy, or disabled members, or the defray-ing
of funeral expenses of deceased members, or to provide for
the wants of the widows and families after death of its members.
Section 2. That Article 8 of Chapter 6 of the Revised Code
of the State of Delaware be and the same is hereby amended by
striking out Section 66, being Section 103 of the Revised Code
of 1915, and by inserting in lieu thereof the following:
103. Section 66. Annual Reports to Secretary of State;
Form and Purpose of; Penalties for not Filing; How Director
May Free Himself from Disability Incurred ; In default of Report
or Without Resident Agent, Service of Process may be made an
Secretary of State; Effect of; Process Book, how kept by Secre-tary
of State :Annually, on or before the first Tuesday in Janu-ary,
it shall be the duty of the President, Secretary, Treasurer or
other proper officer, or any two directors, of any corporation now
existing or hereafter to be incorporated under the provisions of
the General Corporation Law of the State of Delaware, to make
an annual report to the Secretary of State, stating specifically
with the degree of particularity required by Paragraph 2, Section
5 of Chapter 15, being Section 1919 of the Revised Code of the
State of Delaware, the location of its principal office in this State ;
the name of the agent upon whom service of process against said
corporation may be served; the location or locations (city or cities,
town or towns, street or streets and number of same, if number
there be) of the place or places of business of said corporation
without this State; the names and addresses of all the directors
and officers of the corporation and when the terms of each expire ;
the date appointed for the next annual meeting of the stock-
LAWS OF DELAWARE 19
FRANCHISE TAX
holders for the election of directors; the number of shares of
each class of the capital stock which is to be issued, if any,
and the amount of the par value stock, and the number
of shares actually issued of each class of the capital stock which
is to be issued, if any, and the amount of the par value actually
issued ; the amount of capital invested in real estate and manu-facturing
in the State of Delaware, and the taxes paid thereon ;
and, if exempt from taxation for any cause, the specific facts
entitling such corporation to exemption from such taxation.
If such annual report is not so made and so filed by the cor-poration
through its proper officers, or if any corporation shall
neglect or refuse to make such report, the Secretary of State shall
ascertain and fix the amount of the annual franchise tax as de-termined
upon a basis by him deemed to be most practicable
and the amount so fixed by him shall stand as such basis of taxa-tion
under the provisions of this Article. In the event of neglect,
refusal or failure on the part of any corporation to make such
annual report to the Secretary of State within three months after
the first Tuesday in January, as heretofore provided, the corpora-tion
shall pay the sum of Twenty-five Dollars to be recovered
through an addition of this amount to the franchise tax as above
determined and fixed, and such additional sum shall become a
part. of the franchise tax as so determined and fixed, and be col-lected
in the same manner and subject to the same penalties.
If such report shall not be so made and filed, all the directors of
any such corporation, who shall wilfully refuse to comply with the
provisions herein set forth and who shall be in office during the
default, shall at the time appointed for the next election, and for
a period of one year thereafter, be thereby rendered ineligible
for election or appointment to any office in the corporation as di-rector
or otherwise ; no director shall be thus disqualified for the
failure to make and file such report, if he shall file with the Secre-tary
of State, before the time appointed for holding the next elec-tion
of directors after such default, a certificate stating that he
has endeavored to have such report made and filed, but that the
officers have neglected to make and file the same, and shall report
the items required to be stated in such annual report so far as
20 LAWS OF DELAWARE
FRANCHISE TAX
they are within his knowledge, or are obtainable from sources
of such information open to him, verified by him to be true to the
best of his knowledge, information and belief. If any officer or
director of a corporation required to make an annual report to
the Secretary of State shall, in such return, make any false state-ment,
he shall be deemed guilty of perjury.
All corporations, accepting the provisions of the Constitu-tion
of the State of Delaware, and coming under the provisions
of the General Corporation Law of this State, and all corporations
now existing or hereafter to be incorporated under the provisions
of said law, shall make and file an annual report with the Sec-retary
of State as hereinbefore provided in this Section ; upon
failure, neglect, or refusal to file such annual report the Secretary
of State shall investigate the reasons therefor with the view of
having the charter of such corporation forfeited in accordance
with the provisions of Section 67 of Chapter 65 of the Revised
Code of 1915; provided, however, that in the discretion of the
Secretary of State the filing fee may be remitted in the case of
a charitable or beneficial organization, carried on without profit,
or a corporation that is required to file a report with the Insurance
Commissioner or the State Bank Commissioner for which a fee
is collected.
The Secretary of State shall, upon application, forward blank
annual reports in proper form, and shall safely keep all reports
returned in such manner as they may be open to the inspection
of all persons at proper hours.
In case any such corporation shall fail to file such report
within the time required by this Section, and in case the agent
in charge of the principal office of any such corporation, upon
whom process against such corporation may be served, shall
die, or shall resign, or shall refuse to act as such, or shall remove
from the State of Delaware, or such agent cannot with due dili-gence
be found, it shall be lawful while such default continues,
to serve process against such corporation upon the Secretary
of State, and such service shall be as effective to all intents and
purposes as if made upon the President or head officers of such
LAWS OF DELAWARE 21
FRANCHISE TAX
corporation, and within two days after such service upon the
Secretary of State as aforesaid, it shall be the duty of said Sec-retary
of State to notify such corporations thereof by letter
directed to such corporation at its registered office, in which
letter shall be enclosed a copy of the process or other paper
served ; and it shall be the duty of the plaintiff in any action in
which said process shall be issued to pay to the Secretary of
State, for the use of the State, the sum of Three Dollars, which
said sum shall be taxed as a part of the costs in said suit, if the
plaintiff shall prevail therein ; the Secretary of State shall keep
a book to be called the "process book," in which shall be entered
alphabetically, by the name of the plaintiff and defendant therein,
the title of all causes in which processes have been served upon
him, the text of the process so served, the return day thereof,
and the day and hour when the service was made.
Section 3. That Article 8 of Chapter 6 of the Revised Code
of the State of Delaware be and the same is hereby amended by
striking out Section 67, being Section 104 of the Revised Code
of 1915, and inserting in lieu thereof the following:
104. Section 67. Rates of Franchise Taxes:All corpora-tions,
accepting the provisions of the Constitution of the State of
Delaware and coming under the provisions of the General Cor-poration
Law of this State, and all corporations, which have here-tofore
filed or may hereafter file a certificate of incorporation
under the provisions of said corporation law, shall pay an annual
franchise tax to the State School Tax Department as follows :
Where the authorized capital stock does not exceed two
hundred and fifty shares, Five Dollars ; where the authorized
capital stock exceeds two hundred and fifty shares but is not more
than one thousand shares, Ten Dollars ; where the authorized
capital stock exceeds one thousand shares but is not more than
three thousand shares, Twenty Dollars ; where the authorized
capital stock exceeds three thousand shares but is not more
than five thousand shares, Twenty-five Dollars ; where the autho-rized
capital stock exceeds five thousand shares, but is not
more than ten thousand shares, Fifty Dollars ; and the
22 LAWS OF DELAWARE
FRANCHISE TAX
further sum of Twenty-five Dollars per year on each ten
thousand shares or part thereof ; provided, however, that any
such corporation shall be required to pay only one-half of the
amount of taxes scheduled above, if the corporation shall show
to the satisfaction of the Secretary of State that it has not been
engaged in any of the business activities for which it was granted
a certificate of incorporation. For the purpose of computing the
tax on par value stock each One Hundred Dollar unit of authorized
capital stock shall be counted as one taxable share. In no case
shall the annual tax be less than Five Dollars nor more than
Twenty-five Thousand Dollars.
For the purpose of computing the taxes imposed by this
section, the authorized capital stock of a corporation shall be con-sidered
to be the total number of shares which the corporation is
authorized to issue, whether or not the number of shares that may
be outstanding at any one time be limited to a less number.
Section 4. That Article 8 of Chapter 6 of the Revised Code
of the State of Delaware be and the same is hereby amended
by striking out Section 68 and Section 68 A, being Sections 105
and 105 A, respectively, of the Revised Code of 1915, and by
inserting in lieu thereof the following:
105. Section 68. Franchise Tax Accounts ; Certified by Sec-retary
of State to State Tax Department ; Notice to Taxable ; To
Bear Interest When ; Secretary of State may Investigate Reports
Filed :The Secretary of State shall certify to and file with the
State Tax Department, on or before the first day of April in each
year, a statement of the basis of the franchise tax as determined
from the annual report filed by each corporation as hereinbefore
required, and the amount of tax due thereon respectively at the
rate fixed by Section 67, Article 8, Chapter 6, Revised Code of
Delaware ; such tax shall thereafter become due and payable, and
it shall be the duty of the State Tax Department to immediately
notify all of said corporations of the amount of such franchise
tax due and payable by them to the said State Tax Department,
and it shall be the further duty of the said State Tax Department
to receive such franchise tax and pay over all such taxes collected
to the State Treasurer to be used by the State Board of Education
LAWS OF DELAWARE 23
FRANCHISE TAX
for the support and maintenance of the free public schools of this
State as provided by Section 58, Article XIII, Chapter 160, Volume
32, Laws of Delaware. If the tax of any corporation remains
unpaid on the first day of July after the same becomes due, the
tax shall bear interest at the rate of one per centum for each
month until paid. The Secretary of State shall have power to in-quire
into the truth or falsity of every report required to be filed
to carry out the provisions of this Article ; and may require the
production of the books of any corporation herein referred to
and may swear or affirm and examine witnesses in relation
thereto.
Section 5. That Article 8 of Chapter 6 of the Revised Code
of the State of Delaware be and the same is hereby amended by
striking out Section 69, being Section 106 of the Revised Code
of 1915, and by inserting in lieu thereof the following:
Section 69. Tax as a Debt:The franchise tax, as
assessed and levied in accordance with the provisions of this
Article, shall be a debt due from any corporation, so assessed
and such tax determined for, to the State for which an action at
law may be maintained after the same shall have been in arrears
for a period of one month, and such tax shall also be a preferred
debt in case of insolvency.
Section 6. That Article 8 of Chapter 6 of the Revised Code
of the State of Delaware be and the same is hereby amended by
striking out Section 70, being Section 107 of the Revised Code
of 1915, and by inserting in lieu thereof the following:
Section 70. Collection of Tax ; Remedy by Injunction ;
Effect of:It shall be lawful for the Attorney General, either
of his own motion, or upon request of the State Tax Department,
whenever any franchise tax due under the provisions of this
Article from any corporation shall have remained in arrears for
a period of three months after the said tax shall have become
payable to apply to the Court of Chancery, by petition in the
name of the State, on five days notice to such corporation, which
notice may be served in such manner as the Chancellor may
24 LAWS OF DELAWARE
FRANCHISE TAX
direct, for an injunction to restrain such corporation from the
exercise of any franchise, or the transaction of any business
within this State, until the payment of such tax and interest
due thereon and the cost of such application, which shall be fixed
by the Chancellor ; the said Court is authorized to grant such
injunction, if a proper case appears, and upon granting and ser-vice
of such injunction, it shall not be lawful for any such cor-poration
thereafter to exercise any franchise or transact any
business within this State until such injunction shall be dissolved.
Section 7. That Article 8 of Chapter 6 of the Revised Code
of the State of Delaware be and the same is hereby amended by
striking out Section 71, being Section 108 of the Revised Code
of 1915, and by inserting in lieu thereof the following:
108. Section 71. Collection of Tax ; Further Remedy in
Court of Chancery ; Receiver When Appointed ; Property of De-linquent
Corporation How Applied to Payment of Tax:After
any corporation, now existing or hereafter incorporated under
the provisions of the General Corporation Law of this State, has
failed or neglected for the period of two consecutive years to pay
the franchise taxes imposed by law, and the State Tax Depart-ment
shall have reported such corporation to the Governor of
this State, as provided in Chapter 75 of this Article, then it shall
be lawful for the Attorney General of this State to proceed against
said corporation in the Court of Chancery of this State for the
appointment of a receiver, or otherwise, and the said court in
such proceeding shall ascertain the amount of the taxes remain-ing
due and unpaid by such corporation to the State of Delaware,
and shall enter a final decree for the amount so ascertained,
and thereupon a fieri facias or other process shall issue for the
collection of the same as other debts are collected, and if no
property which may be seized and sold on fieri facias shall be
found within the said State of Delaware, sufficient to pay such
decree, the said court shall further order and decree that the said
corporation, within ten days from and after the service of notice
of such decree upon any officer of said corporation upon whom
service of process may be lawfully made, or such notice as the
court shall direct, shall assign and transfer to the trustees or
receiver appointed by the court, any chose in action, or any
LAWS OF DELAWARE 25
FRANCHISE TAX
patent or patents, or any assignments of or license under any
patented invention or inventions owned by, leased or licensed to
or controlled in whole or in part by said corporation, to be sold
by said receiver or trustee for the satisfaction of such decree, and
no injunction theretofore issued nor any forfeiture of the charter
of any such corporation shall be held to exempt such corporation
from compliance with such order of the court; and if the said
corporation shall neglect or refuse within ten days from and after
the service of such notice of such decree to assign and transfer
the same to such receiver or trustee for sale as aforesaid, it shall
be the duty of said court to appoint a trustee to make the assign-ment
of the same, in the name and on behalf of such corporation,
to the receiver or trustee appointed to make such sale, and the
said receiver or trustee shall thereupon, after such notice and in
such manner as required for the sale under fieri facias of personal
property, sell the same to the highest bidder, and the said re-ceiver
or trustee, upon the payment of the purchase money, shall
execute and deliver to such purchaser an assignment and transfer
of all the patents and interests of the corporation so sold, which
assignment or transfer shall vest in the purchaser a valid title
to all the right, title and interest whatsoever of the said corpora-tion
therein, and the proceeds of such sale shall be applied to the
payment of such unpaid taxes, together with the costs of said
proceedings.
Section 8. That Article 8 of Chapter 6 of the Revised Code
of the State of Delaware be and the same is hereby amended by
striking out Section 72, being Section 109 of the Revised Code of
1915, and by inserting in lieu thereof the following:
109. Section 72. Review of Assessment; Proceedings for;
Limitation of ;The officers of any corporation who shall consider
the assessment made or the tax levied under the provisions of
this Article excessive or otherwise unjust, may make application
to the State Tax Board for a review of the assessment and com-mutation
of the tax; provided, there be filed with the said Tax
Board, within three months from the date of the assessment, a
petition of appeal, duly verified according to law, stating
specifically the grounds upon which the appeal is taken and the
26 LAWS OF DELAWARE
FRANCHISE TAX
reason why the assessment is considered excessive or the tax
unjust; the State Tax Board shall thereupon proceed to investi-gate
the contentions raised by the said petition of appeal, and
for the purpose of such investigations, the officers of said corpora-tion
may be summoned to appear before the said Board, either
in person or by attorney, and questioned as to the statements set
forth in the said petition ; if, in the opinion of the State Tax
Board, it shall appear that the assessment made is excessive or
the tax so levied is unjust, the said Board shall request the officers
of the corporation to file with the Board a corrected return, and
the assessment shall be adjusted upon said corrected return and
the tax commuted as in the opinion of the said Board shall be
deemed proper.
Section 9. That Article 8 of Chapter 6 of the Revised Code
of the State of Delaware be and the same is hereby amended by
striking out Section 73, being Section 110 of the Revised Code of
1915, and by inserting in lieu thereof the following:
110. Section 73. Retaliating Taxation and Regulation ;
When Imposed :When, by the laws of any other State or Nation,
any other or greater taxes, fines, penalties, licenses, fees, or other
obligations or requirements are imposed upon corporations
chartered under the provisions of this Article, doing business in
such State or Nation, or upon their agents therein, than the law
of this State imposes upon their corporations or agents doing
business in this State, so long as such laws continue in force in
such other State or Nation, the same taxes, fines, penalties,
licenses, fees, obligations and requirements of whatever kind
shall be imposed upon all corporations of such other State or
Nation doing business within this State or upon their agents here ;
provided, nothing herein shall be held to repeal any duty, con-dition
or requirement now imposed by law upon such corporations
of other States or Nations transacting business in this State.
Section 10. That Article 8 of Chapter 6 of the Revised Code
of the State of Delaware be and the same is hereby amended by
striking out Section 74, being Section 111 of the Revised Code
of 1915, and by inserting in lieu thereof the following :
LAWS OF DELAWARE 27
FRANCHISE TAX
Section 74. Failure to Pay Franchise Tax for Two
Years ; Charter Void :If any corporation, accepting the pro-visions
of the Constitution of the State of Delaware and coming
under the provisions of the General Corporation Law of this
State, or any corporation which has heretofore filed or may here-after
file a certificate of incorporation under the provisions of
the said law, shall for two consecutive years neglect or refuse to
pay the State any franchise tax or taxes, which has or have
been, or shall be assessed against it, or which it is required to
pay under the provisions of this Article, the charter of such cor-poration
shall be void, and all powers conferred by law upon such
corporation are declared inoperative, unless the State Tax Board
shall for good cause shown to it, give further time for the pay-ment
of such tax or taxes, in which case a certificate thereof
shall be filed by the said Board in the office of the State Tax De-partment
stating the reason therefor.
Section 11. That Article 8 of Chapter 6 of the Revised Code
of the State of Delaware be and the same is hereby amended by
striking out Section 75, being Section 112 of the Revised Code of
1915, and by inserting in lieu thereof the following:
Section 75. Report of Delinquent Corporations by
State Tax Department to Governor; Proclamation by Governor : On or before the first Tuesday of January in each year, the State
Tax Department shall report to the Governor a list of all the
corporations, which for two years next preceding such report,
have failed, neglected or refused to pay the franchise taxes
assessed against them or due by them, under the laws of this
State, and the Governor shall forthwith issue his proclamation
declaring that the charters of these corporations are repealed.
Section 12. That Article 8 of Chapter 6 of the Revised Code
of the State of Delaware be and the same is hereby amended by
striking out Section 76, being Section 113 of the Revised Code
of 1915, and by inserting in lieu thereof the following:
Section 76. Proclamation Filed and Published ; Note on
Record of Certificate of Incorporation of Repeal of Charter:
28 LAWS OF DELAWARE
FRANCHISE TAX
The Proclamation of the Governor shall be filed in the office of
the Secretary of State and advertised in at least one, and not
more than three, newspapers published within this State. Upon
the filing of such proclamation, the Secretary of State shall
transmit forthwith to the Recorder of each County of this State
a certified copy of said proclamation, and each Recorder shall,
upon receipt of such certified copy, forthwith mark in brief upon
the margin of the record of the Certificate of Incorporation named
in said proclamation, which is of record in his office, the fact
that the charter of said corporation is repealed, and the date
of said repeal.
Section 13. That Article 8 of Chapter 6 of the Revised Code
of the State of Delaware be and the same is hereby amended by
striking out Section 77, being Section 114 of the Revised Code
of 1915, and by inserting in lieu thereof the following:
Section 77. Acting under Proclamed Charter a Mis-demeanor
; Penalty :Any corporation, firm, company, associa-tion,
persons, or person, who shall exercise or attempt to exercise
any powers under the Certificate of Incorporation of any corpora-tion,
which shall have been proclamed by the Governor, after
the issuance of such proclamation, shall be deemed guilty of a
misdemeanor and shall be punished by a fine not exceeding One
Thousand Dollars ($1,000.) or by imprisonment not exceeding
one (1) year, or both, in the discretion of the Court.
Section 14. That Article 8 of Chapter 6 of the Revised Code
of the State of Delaware be and the same is hereby amended by
striking out Section 78, being Section 115 of the Revised Code
of 1915, and by inserting in lieu thereof the following:
Section 78. Duties of Deputy Attorney General :The
Deputy Attorney General, appointed in accordance with the pro-visions
of Section 32, Chapter 9, Volume 32, Laws of Delaware,
as amended, shall have all the powers and authorities in conjunc-tion
with the State Tax Department to collect all franchise taxes
and penalties due from proclaimed corporations and corporations
whose charter has become void by operation of law for non-pay-
LAWS OF DELAWARE 29
FRANCHISE TAX
ment of taxes thereunder.
Section 15. That Article 8 of Chapter 6 of the Revised Code
of the State of Ddlaware be and the same is hereby amended by
striking out Section 79, being Section 116 of the Revised Code of
1915, and by inserting in lieu thereof the following:
116. Section 79. Mistakes in Proclamation; How Cor-rected
:Whenever it is established to the satisfaction of the
Governor that any corporation named in said Proclamation has
not neglected or refused to pay the franchise tax within two con-secutive
years, or has been inadvertently reported to the Governor
by the State Tax Department as refusing or neglecting to pay
such taxes as aforesaid, the Governor is authorized to correct
such mistake and to make the same known by filing his procla-mation
to that effect in the office of the Secretary of State, who
shall restore to said corporation its charter, together with all the
rights, privileges, and immunities and subject to all its duties,
debts and liabilities which had been secured or imposed by its
original charter and all amendments thereto.
Section 16. That Article 8 of Chapter 6 of the Revised Code
of the State of Delaware be and the same is hereby amended by
repealing Section 80, Section 81, Section 82 and Section 83, being
Sections 117, 118, 119 and 120, respectively, of the Revised Code of
1915.
Section 17. That no franchise tax assessed or assessable
during the calendar year 1929, or any prior year, under the pro-visions
of 102. Section 65, 103. Section 66, 104. Section 67, 105.
Section 68 and 106. Section 69, as heretofore existing, and no
assessment, suit, proceeding, or matter of any kind with respect
thereto, shall be in anywise affected by this Act, and the pro-visions
of said 102. Section 65, 103. Section 66, 104. Section 67,
105. Section 68 and 106. Section 69, as heretofore existing, shall
be continued in full force and effect as to all such taxes, assess-ments,
suits, proceedings and matters. All said franchise taxes
so assessed or assessable during the calendar year 1929, or any
prior year, shall be paid over to the State Treasurer by the State
Tax Department to be used by the State Board of Education for
30 LAWS OF DELAWARE
FRANCHISE TAX
the support and maintenance of the free public schools of this
State.
Section 18. That all Acts or parts of Acts inconsistent with
this Act be and they are hereby repealed to the extent of such
inconsistencies only.
Approved April 1, 1929.
LAWS OF DELAWARE 31
CHAPTER 7
STATE REVENUE
INHERITANCE TAX
AN ACT to amend Chapter 98 of the Revised Code of Delaware
(1915) relating to Inheritance Tax as the same has been
amended.
Be it enacted by the Senate and House of Representatives of
the State of Delaware in General Assembly met:
Section 1. That Chapter 6 of the Revised Code of Delaware
(1915) be and the same is hereby amended by striking out all of
146, Section 109 after the first paragraph thereof, and inserting
in lieu thereof the following:
Class A. Where the property or any interest or estate
therein passes to or for the use of a husband or wife, the tax on
such property, interest or estate shall be at the following rates:
On that part of its value exceeding Twenty Thousand Dollars
($20,000) and not exceeding Fifty Thousand Dollars ($50,000)
one per cent;
On that part of its value exceeding Fifty Thousand Dollars
($50,000) and not exceeding One Hundred Thousand Dollars
($100,000) two per cent ;
On that part of its value exceeding One Hundred Thousand
Dollars ($100,000) and not exceeding Two Hundred Thousand
Dollars ($200,000), three per cent;
On that part of its value exceeding Two Hundred Thousand
Dollars ($200,000), four per cent ;
Class B. Where the property or any interest or estate
therein passes to or for the use of a parent, grandparent, child,
by birth, Ivife or widow of a son or the husband of a daughter, a
32 LAWS OF DELAWARE
INHERITANCE TAX
child by legal adoption, or lineal descendant of the testator, in-testate
grantor, donor or setlor (hereinafter called the decedent,
the tax on such property, interest or estate than shall be at the
following rates:
On that part of its value exceeding Three Thousand Dollars
and not exceeding Thirty Thousand Dollars, one per cent;
On that part of its value exceeding Thirty Thousand Dollars
and not exceeding One Hundred Thousand Dollars, two per cent;
On that part of its value exceeding One Hundred Thousand
Dollars and not exceeding Two Hundred Thousand Dollars, three
per cent;
On that part if its value exceeding Two Hundred Thousand
Dollars, four per cent;
Class C. Where the property or any interest or estate
therein passes to or for the use of (1) a brother, or sister, either
of the whole or half blood, of the decedent or of the decedent's
parent or grandparent, or (2) a lineal descendant of any such
brother or sister, the tax shall be at the following rates:
On that part of its value exceeding One Thousand Dollars
and not exceeding Twenty-five Thousand Dollars, two per cent;
On that part of its value exceeding Twenty-five Thousand
Dollars and not exceeding One Hundred Thousand Dollars, three
per cent ;
On that part of its value exceeding One Hundred Thousand
Dollars and not exceeding Two Hundred Thousand Dollars, four
per cent ;
On that part of its value exceeding Two Hundred Thousand
Dollars, five per cent.
LAWS OF DELAWARE 33
INHERITANCE TAX
Class D. In case of property or any interest or estate
therein passing to or for the use of any person, not described
in Class A or Class B of this Section, the tax shall be at the
following rates :
On that part of its value not exceeding Twenty-five Thousand
Dollars, five per cent;
On that part of its value exceeding Twenty-five Thousand
Dollars and not exceeding One Hundred Thousand Dollars, six
per cent;
On that part of its value exceeding One Hundred Thousand
Dollars and not exceeding Two Hundred Thousand Dollars, seven
per cent;
On that part of its value exceeding Two Hundred Thousand
Dollars, eight per cent;
Nothing in this section shall be construed to impose any tax
upon any property, or estate or interest therein passing to or for
the use of, or in trust for, charitable, educational, historical or
religious societies or institutions, or cities or towns for public
improvement, or to school districts or library commission.
Any transfer of a material part of the property of a decedent
in the nature of a final disposition or distribution thereof, made
by the decedent within two years prior to his death without full
consideration in money or money's worth, shall, unless shown to
the contrary, be deemed to have been made in contemplation of
death within the meaning of this chapter.
Approved May 6, 1929.
34 LAWS OF DELAWARE
CHAPTER S
STATE REVENUE
INCOME TAX
AN ACT to provide Revenue for School Purposes.
Be it enacted by the Senate and House of Representatives of
the State of Delaware in General Assembly met:
ARTICLE I
PERSONS TAXABLE
Section 1. As used in this Article, the following words and
phrases are defined as follows:
The phrase "Income Tax" means the tax imposed by
Section 2 hereof.
The word "Taxable" means:
( / ) A natural person twenty-one years of age or over who
is a citizen or resident of the State of Delaware, or who has been
a citizen or resident of the State of Delaware at any time during
the income year.
A minor with a net income of one thousand dollars or
more who is a citizen or resident of the State of Delaware, or who
has been a citizen or resident of the State of Delaware at any
time during the income year.
A minor citizen or resident of Delaware who has at-tained
the age of 21 years during the income year.
A fiduciary, including a guardian, trustee, agent or
representative of a taxable or the executor or the administrator
of the estate of the decedent.
LAWS OF DELAWARE 35
INCOME TAX
DEFINITIONS
The words "Income Year" mean the calendar year or
the fiscal year on the basis of which the income is computed
under this Act.
The phrase "Net Income" means gains or profits and
income derived and actually received into possession of, or
credited subject to withdrawal by, a taxable from any source
whatever, and shall include the aggregate of all gains, capital
gains, profits, salaries, wages and compensation for personal
service of whatever kind and in whatever form paid, including
bonus, honorariums and fees ; income derived from professions,
vocations, business, trade commerce, sales, exchange or other dis-position
of or dealings in real or personal property growing out of
the ownership or use of or interest in such property or otherwise ;
income derived from interest, dividends, securities or the trans-action
of any business carried on for gain or profit ; the share of
the profits of any taxable in an unincorporated association of
persons, syndicate, joint venture or copartnership whether such
profits have been divided or otherwise ; and all amounts recovered
during the income year from bad debts or capital losses that have
been deducted from income in any return of income to this State ;
less the aggregate of the exemptions provided for in Section 3 (a)
paragraphs 1 to 10 inclusive and of the deductions provided for in
Section 4.
The word "Dividends" means any distribution made by
a corporation, joint stock company or association out of its earn-ings
or profits paid to or subject to withdrawal by its shareholders
during the income year, whether in cash or property, but does not
mean a distribution of earnings or profits accrued prior to Janu-ary
1, 1920, or a distribution of capital stock of the corporation,
joint stock company or association making the distribution. Every
distribution shall be deemed to be made out of earnings or profits
to the extent thereof, and from the most recently accumulated
earnings or profits.
Net income shall be accounted "actually received into
possession" when cash, check, script certificate or other evidence
36 LAws OF DELAWARE
INCOME TAX
of ownership has been received by the owner or by his agent, or
representative or by a fiduciary.
Net income shall be accounted "credited subject to with-drawal,"
when the taxable credited, or his agent, representative
or a fiduciary has the right or option to make withdrawal.
"Capital gains or losses" mean gains or losses resulting
from the sale, exchange or disposition, other than by gift, dona-tion,
devise or inheritance, of real or personal property, stocks,
bonds, notes or securities, but do not mean gains or losses arising
from the operation of any business. Capita/ losses shall include
all debts ascertained to be worthless during the income year,
excepting accounts or bills receivable arising from professional
fees, salaries or wages or from sales of merchandise or stock in
trade appertaining to the business of the taxable, as provided for
in Section 4, paragraph 8.
The "Basis for determining the capital gain or loss"
resulting from the sale, exchange or disposition other than by
gift, donation, devise or inheritance, of real or personal property,
stocks, bonds, notes, or securities acquired before January 1,
1920 shall be as provided in Section 7.
THE INCOME TAX
Section 2. (a) Beginning with the year 1930 there shall
be levied, assessed, collected and paid annually by every taxable
a tax on the net income of the preceding calendar year, subject
to the exemptions hereinafter named, to be computed as follows :
One percentum of the amount of net income not in excess of three
thousand dollars ; two percentum of the amount of net income in
excess of three thousand dollars but not in excess of ten thousand
dollars ; three percentum of the amount of net income in excess of
ten thousand dollars. Such tax shall be levied, assessed, collected
and paid upon and in respect to the net income for the calendar
year or for any income year ending during the said calendar
year.
LAWS OF DELAWARE 37
INCOME TAX
The taxes, interest, penalties and other collections
made under the provisions of this Act shall be used for the build-ing,
maintenance, operation and repairs of the public schools and'
maintenance and -operation of the public school system of Dela-ware
and for other purposes specifically authorized by this Act.
A taxable during part of an income year, shall be taxed
on the net income received during such part of the income year
only or, if that amount cannot be determined, shall be taxed for
a part of the whole net income proportionate to the part of the
year in which such person or fiduciary, association or minor
citizen has been a taxable.
EXEMPTED INCOME
Section 3. The following income shall be exempt from in-come
tax:
(a) (1) The proceeds of life insurance policies paid upon
the death of the insured to any taxable.
The amount received by the insured as a return of
premium or premiums paid by him under life insurance, endow-ment
or annuity contracts, either during the term or at the
maturity of the term mentioned in the contract or upon the sur-render
of the contract.
The value of property acquired by gift, bequest, devise
or inheritance but the income received from such property after
its acquisition shall be included in taxable income. The profit
or loss on the sale, exchange or other disposition of such property
shall be determined as provided in Section 7 of this Article.
Interest upon the obligations of the State of Delaware
or any political subdivision thereof or upon the obligations of the
District of Columbia, of the United States or of its possessions.
Dividends paid out of earnings or profits accrued prior
to January 1, 1920.
38 LAWS OF DELAWARE
INCOME TAX
(6)Dividends paid in the capital stock of the corporation,
joint stock company, or association which has declared and autho-rized
the distribution.
Capital gains accrued prior to January 1, 1920.
Salaries, fees, wages, or pensions received from the
United States.
The amount received as alimony or support from a
person who has paid tax thereon under these Articles.
Any amounts paid to injured employees or to the
dependents of deceased employees under the terms of "The Dela-ware
Workmen's Compensation Law of 1917."
(b) In the case of a single person, a personal exemption of
one thousand dollars, or in the case of the head of a family, or a
married person living with husband or wife, a personal exemption
of two thousand dollars, provided, however, that husband and wife
living together shall receive but one personal exemption of two
thousand dollars. Said two thousand dollars may be divided in
the separate returns of the husband and wife in any manner they
ma Y choose.
There shall be a credit of Two Hundred Dollars ($200.00)
for each person (other than husband or wife) dependent upon
and receiving his or her chief support from the taxpayer if such
dependent person is under twenty years of age or is incapable
of self-support because mentally or physically defective.
"Head of family" means one who maintains a dwelling, house
or apartment for the use of himself or herself and another or
others who pay no rent or compensation for their accommodation
and who are chiefly dependent upon said head of family for sup-port.
Such other person or persons need not be related to the
head of family.
In the case of a husband and wife living together, the income
LAWS OF DELAWARE 39
INCOME TAX
of both may be included in a single joint return, in which case the
tax shall be computed on the aggregate income.
In the case of death or separation of husband or wife, the
exemption authorized shall be apportioned to the time of death
or separation. A separated wife, or husband who is a head of a
family shall be allowed an exemption of $2,000.00; while a separ-ated
wife or husband who is not the head of a family shall be
allowed an exemption of $1,000.00. In no case shall the total
exemption for any year exceed $2,000.00 for any individual.
If through death, change of residence or otherwise, a tax-able
is required to report income for a portion of the year only,
exemption and deductions sustained during the said portion of a
year shall be allowed, providing that if they cannot be accurately
ascertained for the taxable period, a proportionate part of the
exemptions and deductions for the whole year shall be allowed.
DEDUCTIONS
Section 4. In computing net income, the following deduc-tions
shall be allowed:
The necessary expenses actually paid by the taxable
in carrying on any business or trade, not including personal, living
or family expenses and not including transportation costs between
residence and usual place of business.
All interest paid by the taxable within the year on
his indebtedness.
Taxes paid within the income year, except taxes im-posed
by this Act and taxes assessed for local benefits of a kind
tending to increase the value of the property assessed.
A reasonable allowance for the exhaustion, wear and
tear, obsolescence and depletion of property, arising out of its
use or employment in the trade or business of the taxable, but not
including such allowance on the residence of the taxable.
40 LAWS OF DELAWARE
INCOME TAX
Contributions or donations to the State of Delaware or
any political subdivision thereof or to any institution supported
in whole or in part by the State or any contribution or donation
for religious, charitable, scientific or educational purposes for
use in the State of Delaware only, provided that such contribu-tions
or donations shall not exceed fifteen per centum of the tax-payer's
net income, as computed without the benefit of this
paragraph.
Losses sustained during the income year in the opera-tion
of farms or in other agricultural, horticultural, dairy or poul-try
pursuits or in the raising or preparation of animals, birds,
poultry, vegetables, fruit, fish or sea food for the market. De-preciation
of buildings or other property used in such operations
may be included in losses incurred but no personal or household
expenses of the owner or manager of the operation or of his family
shall be included in such loss.
Losses sustained during the income year through
destruction of property by fire, flood, lightning, storm or collision,
and losses caused by other casualty or by theft, provided that such
losIs are not compensated for by insurance or otherwise.
Debts ascertained during the income year to be worth-less
and represented by accounts or bills receivable arising from
professional fees, salaries, wages or from sales of merchandise or
stock in trade appertaining to the business of the taxable, pro-vided
that such accounts or bills receivable have previously and
while uncollected been included as income in an income tax return
to this State.
Debts ascertained to be worthless within the income
year represented by accounts or bills receivable that have not
previously and while uncollected been included in gross income,
in an income tax return to this State, but such debts shall be de-ductible
as capital losses only and to the extent that capital losses
are deductible as provided in paragraph (11) hereof. (This pro-vision
shall not apply if the income from a business, trade or
profession is reported on the basis of cash receipts and disburse-
LAWS OF DELAWARE 41
INCOME TAX
ments, in which case such debts shall not be deductible).
Losses sustained during the income year through en-dorsement
or guaranty of notes or obligations of any kind or
through liability on subscription to stocks, bonds and notes or
through contingent liability but such losses shall be deductible as
capital losses only and to the extent that capital losses are de-ductible
as provided in paragraph (11) hereof.
Capital losses as defined in Section 1, paragraph (g)
accrued after January 1, 1920 and that have been realized during
the income year, but such losses shall be deductible from capital
gains and to the extent thereof only.
TRUSTS AND ESTATES
Section 5. (a) The tax imposed by this Article shall apply
to the income of estates or of any kind of property held in trust,
including:
Income received by estates of deceased persons during
the period of administration or settlement of estate.
Income accumulated in trust for the benefit of unborn
or unascertained persons, or persons with contingent interests.
Income held for future distribution under the terms of
the will or trusts.
Income which is to be distributed to beneficiaries
periodically, whether or not at regular intervals.
Income collected by a guardian of an infant or infants
to be held or distributed as the court may direct.
(b) The fiduciary shall be responsible for making the return
of income for an estate or trust for which he or it acts. The net
income of the estate or trust shall be computed in the same man-ner
and on the same basis as hereinbefore provided in this Article,
42 LAWS OF DELAWARE
INCOME TAX
except that there shall also be allowed as a deduction, any part of
the gross income which, pursuant to the terms of the will or
deed creating the trust, is during the taxable year paid to or per-manently
set aside for the United States, any state or territory
or any political subdivision thereof, or the District of Columbia or
for any corporation or association organized or operated exclu-sively
for religious, charitable, scientific, or educational purposes
or for the prevention of cruelty to children or animals, provided
that no part of the net earnings of such corporation or association
inures to the benefit of any individual stockholder or individual.
In cases under paragraphs (3) (4) and (5) of subdivision (a) of
this section the fiduciary shall include in the return a statement
of each beneficiary's distributive share of net income, whether or
not distributed before the close of the taxable year for which the
return is made.
In cases under paragraphs 1, 2, 3, 4 or 5 of subdivision
(a) the tax shall be imposed upon the net income of the estate or
trust and shall be paid by the fiduciary. In determining net in-come
under this paragraph, there shall be deducted the amount of
any income properly paid to or credited subject to withdrawal by
any legatee, heir or other beneficiary, and a further deduction for
net income paid to or accruing to the benefit of a non-taxable. The
same exemptions and deductions allowable to a single person
under Sections 3 and 4 of this Article shall be allowed to estates
or trusts.
Income properly paid or credited subject to withdrawal,
deducted under subdivision (c), shall be returned by the legatee,
heir or beneficiary to whom it has been paid or credited subject
to withdrawal, as part of his or its income for the income year in
which received or credited.
Unincorporated associations of persons, syndicates,
joint ventures and copartnership shall make a return of income
for information of the Tax Department. Said return shall show
the names and addresses of taxables to whom the net income
received has accrued or has been distributed and the proportionate
interest of each taxable in the net income.
LAWS OF DELAWARE 43
INCOME TAX
RETURNS TO TAX DEPARTMENT
Section 6. (a) Every taxable shall make a return upon
the printed form provided by the Tax Department, stating
specifically the items of gross income, if any, the deductions and
such other facts as said Tax Department may require.
Such taxable shall certify to the truth and correctness
of the return.
The return required by this Section may be made for a tax-able,
when the taxable is unable to make return, by some other
person who shall state the cause of the taxable's inability to file
return and, if required, shall make oath that he has sufficient
knowledge of the affairs of the taxable, for whom he makes the
return, to make such return and that the return is true and
correct. Such person so making a return for another may be
held liable for the penalties provided in Section 20 (e) for makers
of false or fraudulent statements or returns, if error is due to
his willful neglect or false statement.
Unincorporated associations of persons and partner-ships
shall make a return of information as provided in Sec-tion
5 (e).
Officers or employees of the United States who are
citizens or residents of another State but by reason of their
assignment of duty are stationed in Delaware need not make a
return and are exempt from payment of tax under this Act.
Women receiving mother's pensigns, persons receiving
outside support from trustees of the poor and persons who, be-cause
of age, infirmity or mental disability, are wholly or partly
dependent for support shall make return or, if incapable of so
doing, return shall be made for them by the person upon whom
dependent.
The officer in charge of any charitable or public institu-tion
in the State in which reside any persons incapable of making
44 LAWS OF DELAWARE
INCOME TAX
returns shall annually on or before March 15th, furnish to the
Tax Department a complete list of such persons in their charge.
FAILURE TO FILE RETURNS
(g) If the Tax Department shall be of the opinion that any
taxable has failed to file a return, or to include in a return filed,
either intentionally or through error, items of taxable income,
it may require from such taxable a return or a supplementary
return, under oath, in such form as it shall prescribe, of all the
items of income which the taxable received during the year for
which the return is made, whether or not taxable under the pro-visions
of this Act. If from a supplementary return, or otherwise,
the Tax Department finds that any items of income, taxable
under this Act, have been omitted to be disclosed to it, under oath
of the taxable, and to be added to the original return, such supple-mentary
return and the correction of the original return shall
not relieve the taxable from any of the penalties to which he or
it may be liable under the provisions of this Act. The Tax Depart-ment
may proceed under the provisions of Section 20 of this
Article whether or not it requires a return or a supplementary
return under this Section.
DETERMINATION OF AMOUNT OF GAIN OR LOSS
Section 7. (a) Except as hereinafter provided in this Sec-tion,
the gain derived from the sale, exchange or other disposition
of property, real or personal, shall be the excess of the amount
realized therefrom over the basis determined in accordance with
the provisions of this Section, and the loss sustained shall be the
excess of such basis over the amount realized. As used in this
Section : the term "amount realized" means the sum of any money
plus the fair market value of the property (other than money)
received from the sale, exchange or other disposition of property.
(b) The basis for ascertaining the gain derived or the loss
sustained from the sale, exchange or other disposition of property,
real or personal, acquired after December 31, 1919, shall be the
cost of such property, except that :
LAWS OF DELAWARE 45
INCOME TAX
In the case of such property acquired by gift : The
basis shall be the same as that which it would be in the hands of
the donor or the last preceding owner by whom it was not acquired
by gift. If the necessary facts are unknown to the donee, the
Commissioner shall obtain such facts from the donor, or from
any other person cognizant thereof. If the Commissioner fihds
it impossible to obtain such facts, the basis shall be the fair mar-ket
value of the property as found by the Commissioner as of
the date or approximate date at which, according to the best
information the Commissioner is able to obtain, the property was
acquired by the donor or last preceding owner.
In the case of personal property acquired by bequest,
devise or inheritance : The basis shall be the value of such prop-erty
as determined by the officer appointed by the Register of
Wills.
In the case of real property acquired by bequest, devise
or inheritance: The basis shall be the fair market value at the
date of acquisition by the taxable.
In the case of such property held in trust: The basis
shall be the same as that which it would be if it had remained
in the hands of the creator of the trust.
In the case of such property acquired upon an exchange
described in sub-divisions (h) and (1) of this Section: The basis
shall be the same as in the case of the property exchanged, de-creased
by the amount of any money received in the exchange,.
and increased by the amount of gain, or decreased by the amount
of loss to the taxpayer recognized upon such exchange under the
law applicable to the year in which such exchange was made. If
the property so acquired consisted in part of the type of property
permitted by sub-division (h) to be received without the recog-nition
of gain or loss, and in part of other property, the basis
provided in this paragraph shall be allocated between the prop-erties
(other than money) received, and for the purpose of the
allocation there shall be assigned to such other property an
amount equivalent to its fair market value, at the date of the
exchange.
46 LAWS OF DELAWARE
INCOME TAX
(6) In the case of stock upon which stock dividend has
been paid the cost basis for original and dividend holdings shall
be determined in accordance with the following rules :
Where the stock issued as a dividend is of the same
character or preference as the stock upon which the dividend is
paid :The basis of each share shall be the quotient found by
dividing the total cost of the original shares by the total shares
both original and dividend.
Where the stock issued as a dividend is of a character
or preference different from the stock upon which the dividend
is paid :The cost of the original shares of stock shall be divided
between such stock and the dividend stock in proportion, as nearly
as may be, to the respective values of each class of stock at the
time the dividend is paid. If no value at time of payment of
dividend can be established preferred shares having par value
shall be valued at par and the remainder of the total value shall
be allotted to the common shares.
(7) In the case of stock received in a distribution described
in paragraph (4) of sub-division (h), the basis for the original
stock and the stock received in such distribution shall be de-termined
in accordance with the rules contained in the preceding
paragraph, in the same manner as if the stock received in such
distribution were received as the result of a stock dividend.
The basis for ascertaining the gain derived or the loss
sustained from the sale, exchange or other disposition of prop-erty,
real or personal, acquired prior to January 1, 1920, shall
be (1) the same as it would be if determined in accordance with
the provisions of sub-division (b), or (2) the fair market value
of such property as of January 1, 1920, whichever is higher.
In computing the amount of gain or loss under sub-division
(a) :
(I) Proper adjustment shall be made for any expenditure
or item of loss properly chargeable to capital account.
LAWS OF DELAWARE 47
INCOME TAX
(II) The basis shall be diminished by the deductions for
exhaustion, wear and tear, obsolesence and depletion which have
since the acquisition of the property been allowed to such prop-erty
under this Act or under Chapter 9, Volume 32, Laws of
Delaware, as amended.
Where, in the case of property received as a bonus in
the purchase of other property, there is a sale, exchange or other
disposition of such bonus or the property purchased, or both,
the cost of the purchased property shall be fairly apportioned
to such bonus and purchased property in ascertaining the basis
for determining the gain derived or loss sustained. But if such
apportionment should be impracticable, sales of any part of the
property purchased or of the bonus shall be charged to cost
until the latter shall have been completely recovered from such
sales. The proceeds of further sales shall then be accounted as
gain in the year such sales are made.
Where, in the case of the sale, exchange or other dis-position
of property, the amount realized is substantially less than
the fair market value of such property at the time of such sales,
exchange or other disposition, the Commissioner may treat the
difference between the fair market value and the amount realized
as a gift and not a capital loss as defined in Section 1, provided,
that in such event, the basA of the property shall remain the same
as it was before such sale, exchange or disposition.
(1) In the case of shares of stock in a corporation
which are sold or exchanged from lots purchased at different dates
or at different prices and when the identity of the lots can not be
determined :The stock sold shall be charged against the earliest
acquired stock.
(2) If the stock upon which a stock dividend is paid was
purchased at different times and at different prices and the
identity of the lots can not be established, sale of the original
stock shall be charged to the earliest purchases of such stock and
a sale of dividend stock shall be accounted as made from the
dividend paid on the earliest purchased original stock to the extent
of the dividend chargeable to such stock.
48 LAWS OF DELAWARE
INCOME TAX
(h) No gain or loss shall be recognized in the following
cases :
If property held for productive use in trade or business
or for investment (not including stock in trade or other property
held primarily for sale, nor stocks, bonds, notes, choses in action,
certificates of trust or beneficial interest, or other securities or
evidences of indebtedness or interest) is exchanged solely for
property of a like kind to be held either for productive use in trade
or business or for investment.
If common stock in a corporation is exchanged solely
for common stock in the same corporation, or if preferred stock
in a corporation is exchanged solely for preferred stock in the
same corporation.
If stock or securities in a corporation a party to a re-organization
are, in pursuance of the plan of reorganization, ex-changed
solely for stock or securities in such corporation or in
another corporation a party to the reorganization.
If there is distributed, in pursuance of a plan of re-organization,
to a shareholder in a corporation a party to the
reorganization, stock or securities in such corporation or in an-other
corporation a party to the reorganization, without the sur-render
by such shareholder of stock or securities in such a cor-poration,
such a distribution shall not be considered a distribution
of earnings or profit within the meaning of sub-division (e) of
Section 1.
If property is transferred to a corporation by one or
more persons solely in exchange for stock or securities in such
corporation, and immediately after the exchange such person or
persons are in control of the corporation ; but in the case of an
exchange by two or more persons this paragraph shall apply
only if the amount of the stock and securities received by each is
substantially in proportion to his interest in the property prior to
the exchange.
LAWS OF DELAWARE 49
INCOME TAX
As used in this Section :The term "reorganization" means
(a) a merger or consolidation (including the acquisition by one
corporation of at least a majority of the voting stock and at least
a majority of the total number of shares of all other classes of
stock of another corporation, or substantially all the properties of
another corporation), or (b) a transfer by a corporation of all
or part of its assets to another corporation if immediately after
the transfer the transferor or its stockholders or both are in con-trol
of the corporation to which the assets are transferred, or (c)
a recapitalization, or (d) a mere change in identity, form, or place
or organization, however effected.
As used in this Section:The term "control" means the
ownership of at least 80 per centum of the voting stock and at
least 80 per centum of the total number of shares of all other
classes of stock of the corporation.
If an exchange would be within the provisions of sub-division
(h) of this Section, if it were not for the fact that the
property received in exchange consists not only of property per-mitted
by such sub-division to be received without the recognition
of gain, but also of other property or money, then no loss shall be
recognized, but the gain, if any, to the recipient shall be recog-nized,
but in an amount not in excess of the sum of such money
and the fair market value of such other property.
Where property is sold or otherwise disposed of on the
installment plan, gain or loss may, under regulation prescribed by
the Commissioner, be determined in accordance with the following
provisions :
(1) In the case of a business which regularly sells or other-wise
disposes of property on the installment plan, the gain or loss
from such sales or other disposition to be included in the income of
such business for any income year shall be that proportion of the
installment payments actually received in that year which the
gross, profit realized or to be realized when payment is completed,
bears to the total contract price.
50 LAWS OF DELAWARE
INCOME TAX
In the case (A) of a casual sale or other casual disposi-tion
of personal property (other than property 'of a kind which
would properly be included in the inventory of the taxpayer if on
hand at the close of the taxable year), for a price eRceeding $1,000,
or (B) of a sale or other disposition of real property, if in either
case the initial payments do not exceed 40 per centum of the sell-ing
price, the income may be returned on the basis and in the
manner above prescribed in this sub-division. As used in this
sub-division the term "Initial payments" means the payments
received in cash or property other than evidences of indebtedness
of the purchaser during the income year in which the sale or other
disposition is made.
If a taxpayer entitled to the benefits of paragraph (1)
elects for any income year to report his net income on the install-ment
basis, then in computing his income for the year of change
or any subsequent year, amounts actually received during any
such year on account of sales or other dispositions of property
made in any prior year shall not be excluded.
If an installment obligation is satisfied at other than
its face value or distributed, transmitted, sold, or otherwise dis-posed
of, gain or loss shall result to the extent of the difference
between the basis of the obligation and (A) in the case, of satis-faction
at other than face value or a sale or exchangethe amount
realized, or (B) in case of a distribution, transmission, or disposi-tion
otherwise than by sale or exchangethe fair market value
of the obligation at the time of such distribution, transmission or
disposition. The basis of the obligation shall be the excess of the
face value of the obligation over an amount equal to the income
which would be returnable were the obligation satisfied in full.
LAWS OF DELAWARE 51
INCOME TAX
ADMINISTRATION OF INCOME TAX
ARTICLE II
TAX DEPARTMENT AND COLLECTION OF TAXES
Section 8.
DEFINITIONS
The words "Tax Department" mean the State Tax
Department.
The words "Tax Board" mean the State Tax Board.
The words "Tax Commissioner" mean the State Tax
Commissioner.
The word "Taxable" means any person, fiduciary, as-sociation
of persons, syndicate, joint venture or co-partnership
subject to making return or to payment of tax imposed by
Article I of this Act.
The words "Notice," "Notification" or "Receipt" re-quired
to be given or provided for by these Articles mean a
written notice, notification or receipt, contained in a sealed
envelope, addressed to the taxable at his last known address and
deposited in the United States mails unless delivered to the tax-able
in person or to his representative or agent.
STATE TAX DEPARTMENT
(a) The administration and enforcement of the provisions
of Articles I and II of this Act, and the collection of the taxes
imposed thereby are hereby vested in the State Tax Department,
which Department i's hereby created to consist of a State Tax
Board, the State Tax Commissioner and such officers and em-ployees
as may be authorized to be appointed or employed by this
Act.
52 LAWS OF DELAWARE
INCOME TAX
STATE TAX BOARD
Section 9. (a) The State Tax Board shall be composed of
three citizens of Delaware appointed by the Governor to serve
until November 1, 1929. Appointments thereafter shall be made
for terms of four years. At least one of the members of the Board
shall be an attorney at law.
STATE TAX COMMISSIONER
(b) The office of State Tax Commissioner is hereby created.
The State Tax Commissioner shall be appointed by the Governor,
subject to confirmation by the Senate, for a term ending Novem-ber
1, 1929, and thereafter for terms of four years; provided,
however, no person shall be appointed State Tax Commissioner
unless such person be generally known to possess knowledge of
the subject of taxation and shall have recognized ability and wide
experience in administrative positions, and who shall have had
the right to vote for a member of the General Assembly of this
State at the last general election preceding such appointment.
The Tax Commissioner shall continue in office until his successor
shall have been duly appointed and qualified. The Tax Commis-sioner
shall be paid a salary of $6,000.00 per annum in equal
monthly installments. Any incumbent of such office may be
reappointed to succeed himself. Vacancies in the office of Tax
Commissioner shall be filled by the Governor for the unexpired
term. The Tax Commissioner shall give bond with sufficient
surety in the sum of One Hundred Thousand Dollars, to be ap-proved
by the Governor. The cost of this bond shall be defrayed
out of the appropriation for maintenance of the Tax Department.
Any Tax Commissioner may, after notice and after opportunity of
being heard, be removed from the office by the Governor for
inefficiency, neglect of duty, or misconduct in office, and a Tax
Commissioner may be removed for these or other causes by the
Senate.
LAWS OF DELAWARE 53
INCOME TAX
POWERS AND DUTIES OF THE STATE TAX DEPARTMENT
Section 10. The Tax Department shall:
Administer, supervise, collect and enforce the Income Tax
imposed by Article I of this Act.
Collect and enforce the Franchise Taxes provided for in
Article 8, of Chapter 6, of the Revised Code, as amended.
Prepare all necessary forms and blanks required in the ad-ministration
of the Income Tax.
Pay daily to the State Treasurer all sums collected by the
Tax Department except such sums as are retained in accordance
with the provisions of this Act as a repayment fund and as a
contingent fund.
POWERS AND DUTIES OF THE STATE TAX BOARD .
Section 11. The Tax Board shall:
Elect from among the members of the Board a chair-man
and a vice chairman to preside in the absence of the chairman
and appoint a secretary who need not be a member of the Board.
The quorum for the transaction of business of the Tax Board
shall be any two members.
Decide all questions of policy submitted by the Tax
Commissioner.
Hear all complaints and appeals from the decisions or
rulings of the Tax Commissioner, and affirm, modify or reverse
such decisions or rulings. Hearings may be informal but record
shall be made of decisions reached. If an informal hearing shall
prove unsatisfactory to the Complainant, such Complainant, or
the Tax Commissioner, may within thirty days, ask for a formal
hearing for completion of the record, and may, within thirty
days after notice of a decision upon such formal hearing, appeal
1
54 LAWS OF DELAWARE
INCOME TAX
to the Superior Court for revision of tax under the provisions
of Section 17 of this Act, or for other relief.
Fix the salaries of all appointees of the Tax Commis-sioner,
provided, however, that the salary of no appointee shall
exceed three thousand six hundred ($3,600.00) dollars for annum.
Take testimony and proofs under oath with reference
to any matter which in its judgment falls within the line of its
official duty. Any member of the Tax Department may be desig-nated
for such purposes.
Keep a minute book in which shall be entered all
transactions of the Board and a statement of all cases of appeal
to the Superior Court together with the determination thereof.
The minute book shall be open to the inspection of members of
the Board and of the Tax Department at any time.
Discharge such other duties and functions as may be
required of the Tax Board in other sections of Articles 1 and 2
of this Act.
POWERS AND DUTIES OF THE STATE TAX
COMMISSIONER
Section 12. The Tax Commissioner shall:
Be the executive head of the Tax Department and have
sole charge of the administration of the Department. Upon him
shall devolve all executive powers and all duties of the Tax De-partment
not specifically vested in the Tax Board by Section 11.
Appoint and may remove: An Assistant Tax Com-missioner
and all other assistants, agents, field agents, field audi-tors,
clerks and employees who may be necessary for the exercise
of the powers and the performance of the duties of the Tax De-partment
and shall prescribe the duties of all such appointees.
LAWS OF DELAWARE 55
INCOME TAX
Maintain a permanent public record of all decisions,
rules and rulings of the Tax Department.
Organize such branch offices as may be necessary.
Make rules, regulations and decisions not inconsistent
with this Act and require such facts and information to be
reported as he may deem necessary to enforce the Income Tax
imposed by this Act.
Prepare and submit for approval of the Tax Board
the blanks necessary for the making of all returns required by
this Act.
On or before February fifteenth of each year, mail to
the last recorded address of each person, fiduciary, association of
persons, syndicate, joint venture or copartnership that has made
a return or report under this Act or under Chapter 9, Volume 32,
Laws of Delaware, as amended, and that has not ceased to be a
taxable, a blank for the purpose of making return.
Record in a book at the main office of the Tax Depart-ment
and open to the inspection of the public all decisions, rules
and rulings of the Tax Board. These records shall be deemed
published as required by this Act. The record may be modified
to conceal the identity of the taxable.
Report monthly to the Tax Board the amount of all
refunds made with the name of the person paid and the date when
such refund was authorized. Such reports shall be spread in the
minutes of the Board.
Submit to the Governor and to the Legislature an
annual report including such recommendations concerning State
Taxes as may be deemed necessary.
Submit biennially to the Governor, on or before the first
day of September; (a) an estimate of revenues to be received
during each of the two succeeding years from the Income Tax,
56 LAWS OF DELAWARE
INCOME TAX
and (b) an itemized estimate of the sums required for the main-tenance
of the Tax Department.
(I) Require such of the officers, agents, or employees of
the Tax Department as he may designate to give bond for the
faithful performance of their duties, in such sum and with such
security as he may determine. All premiums on such bonds shall
be paid by the Tax Department out of monies appropriated for
that purpose.
Prepare and publish annual statistics, reasonably
available with respect to the operation of this Act, including
amounts collected, classification of the incomes and exemptions
of taxables, and such other facts as are deemed pertinent and
desirable.
Prepare and record in a form convenient for inspection
a list of taxables for the current year and of those exempt from
tax under this Act giving full name and address of each taxable.
This list shall be open for public inspection at all times.
Take all necessary steps to enforce the penalties pro-vided
by this Act.
May appoint an unpaid advisory board of not more than
ten lawyers and tax experts to make recommendations concerning
the rules, regulations and decisions of the Department and
concerning changes in the Income Tax Law.
May delegate any powers that devolve upon him.
For the purpose of ascertaining the correctness of any
return or for the purpose of making an estimate of the taxable
income of any taxable, the Tax Commissioner may examine or
cause to be examined, by any agent or designated representative,
any books, papers, records or memoranda bearing upon the mat-ters
required to be included in a return, and may by summons
require the attendance of the taxable or of any other person
having knowledge in the premises, and may take testimony and
LAWS OF DELAWARE 57
INCOME TAX
require proof material for the investigation, with power to ad-minister
oaths to such person or persons. All Banks, Trust Com-panies
and Brokers when required by the Tax Commissioner
shall allow a representative of the Tax Department to verify
all accounts and records pertaining to the income of any taxable.
The Tax Commissioner may constitute his agents, field
agents, or other appointees special constables, and as such they
shall ha'.' e and possess all the powers that are possessed by county
constables under the laws of this State.
The Tax Commissioner shall have all rights of appeal
to the Superior Court as are granted to any taxable under the
provisions of this Act.
SIGNING AND FILING RETURNS
Section 13. (a) Returns shall be in such form as the Tax
Department shall prescribe, from time to time, and shall be filed
by every taxable described in Sections 1, 5, 6 and 8 hereof, with
the Tax Department at its main office or at any branch office
which it may establish, on or before the fifteenth day of March
in each year, for the preceding year. In case of continued sick-ness,
absence or other disability, or whenever in its judgment
good cause exists, the Tax Department may allow further time for
filing returns. Failure to receive, as provided in Section 12 (g)
hereof, or to secure the blank forms for said return shall not re-lieve
any taxable from the obligation of making the return.
Return of the income of minors, idiots, insane persons,
other persons incapable or unable to act for themselves, or for
taxables absent from the State, shall be made as provided in
Section 14.
A return shall be signed by the person making the
return or by the representative or fiduciary acting for such tax-able.
The signature shall be the full name, both given name or
names, and surname. If a married woman, her own name as well
as the name of her husband shall appear.
58 LAWS OF DELAWARE
INCOME TAX
The Tax Commissioner may require a return to be
certified under oath.
INFORMATION REQUIRED OF EMPLOYERS AND OTHERS
All persons, fiduciaries, associations of persons, syndi-cates,
joint ventures, copartnerships or corporations in whatever
capacity acting, including lessees or mortgagors of real or per-sonal
property, and employers, making payment to other persons
of interest, dividends, rent, salaries, wages, premiums, annuities,
compensations, remunerations, emoluments, or other fixed or de-terminable
gains, profits, and income, aggregating $1,000.00 or
more in any taxable year, shall render a true and accurate return
to the Tax Department, under such regulations and in such form
and manner and to such extent as may be prescribed by the Tax
Department, setting forth the amount of any and all such pay-ments
made to citizens or residents of the State of Delaware and
the names and addresses of the recipients of such payments.
The provisions of this paragraph shall apply to officers or em-ployees
of the State of Delaware or of any political subdivision
or any municipal corporation therein.
Every person or partnership doing business in the State
of Delaware as a stock broker shall, when specially required by
the Tax Commissioner render a correct return duly verified under
oath, showing the names of customers who are citizens or resi-dents
of the State of Delaware for whom such person or partner-ship
has transacted any business, with such details as to the
prOfttS, losses, or other information which the Tax Commissioner
may require for each of such customers, as will enable the Tax
Commissioner to determine whether all income tax clue on profits
or gain of such customers has been paid.
RETURNS FOR MINORS, INCOMPETENTS
AND ABSENTEES
Section 14. All returns and payments of income tax for
minors, idiots, insane persons, other persons incapable or unable
to act for themselves, or for taxables absent from the State,
LAWS OF DELAWARE 59
INCOME TAX
shall be made by their guardians, trustees or other persons having
charge of their estate and the collection of the income thereof.
All such fiduciaries shall have credit for the amount of such pay-ments
made on behalf of the beneficiary in any account which
they make as such fiduciaries, and receipts for such payments
from the Tax Department shall be sufficient vouchers to entitle
these fiduciaries to such credit.
TIME AND PLACE OF PAYMENT OF TAX
Section 15. (a) (1) The full amount of the tax payable,
as the same shall appear from the face of the return, shall be paid
to the Tax Department at the office where the return is filed at
the time fixed by law for filing the return, or the amount of said
tax may be paid in four equal installments, as follows :
(2) One-fourth of the amount at the time fixed for filing
the return ; one-fourth of the amount on the fifteenth day of
the third month after the time fixed for filing return ; one-fourth
of the amount on the fifteenth day of the sixth month after the
time fixed for filing return ; and one-fourth of the amount on
the fifteenth day of the ninth month after the time fixed for filing
the return.
If it shall appear that prompt collection of the entire
amount of taxes, interest or penalties due will impose severe hard-ship
on the taxable, the Commissioner may, in his discretion, per-mit
payments by installments and may require a bond from the
taxable for the carrying out of the agreement to pay.
If any installment provided in (a) and (b) is not paid
when due, the whole amount of the tax unpaid shall become due
and shall be paid upon notice and demand by the Tax
Commissioner.
The Tax Board at a meeting or by written assent, may
reasonably extend the time for making any payment of tax due
under this Act but such extension of time shall be recorded in the
minutes of the Tax Board.
60 LAWS OF DELAWARE
INCOME TAX
If the time for filing the return shall be extended,
interest at the rate of six per centum per annum, from the time
when the return was originally required to be filed, to the date
of payment, shall be added and paid.
The tax may be paid with uncertified check, certified
check or money order during such time and under such regula-tions
as the Tax Commissioner shall prescribe, but if a check
or money order so received is not paid on demand by the bank or
post office on which it is drawn, the taxable by whom such check
or money order is tendered shall remain liable for the payment
of the tax and for all legal penalties, the same as if such check
or money order had not been tendered.
Every tax imposed by this Act, and all increases, in-terest
and penalties thereon shall become, from the time it is
due and payable, a personal debt, from the person or persons or
corporation liable to pay the same, to the State of Delaware.
If, after the assessment of any tax, increase, interest,
and / or penalty shall have become final, the same or any part
thereof shall remain unpaid for ten days, the Tax Department
shall file with the Prothonotary of the Superior Court of the
County in which the taxable resides, a certificate of such assess-ment,
stating the amount thereof, the date assessed, and the
dates of the notice or notices, if any, given to the taxable in
connection therewith, together with a brief summary of the pro-ceedings
had thereon. It shall thereupon be the duty of the
Prothonotary to enter the total amount of such assessment as a
judgment in favor of the State of Delaware, and the said amount
so entered shall thereupon be and constitute a judgment of record
in said Court with like force and effect as any other judgment
in said Court. Upon the entry of such judgment it shall be the
duty of the Tax Department forthwith to utilize the most ex-peditious
means provided by law for the collection of the amount
thereof; and it is hereby expressly provided that no property,
wages, salaries, or other income of any taxable shall be exempt
from execution or attachment process issued upon or for the col-lection
of any such judgment.
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INCOME TAX
EXAMINATION OF RETURNS
Section 16. (a) As soon as practicable after the return
is filed, the Tax Department shall examine it and compute the
tax and the amount so computed shall be the tax.
ADDITIONAL TAXES
If the Tax Department discovers from the examination
of the return or otherwise that the income of any taxable, or any
portion thereof, has not been assessed, it may, at any time within
two years after the time when the return was due or filed, assess
the same and give notice to the taxable of such assessment, and
at the termination of thirty days the additional tax determined by
the Tax Department shall be due and payable, unless the taxable
or his agent or attorney shall have within said thirty days, filed
complaint or appeal in writing over his signature from the assess-ment
of the Tax Commissioner and requested a hearing before
the State Tax Board, as provided in Section 11 (c) of this Article.
The limitation of two years to the assessment of such tax shall not
apply to the assessment of additional taxes upon returns which
are false or fraudulent or the income thereon grossly understated,
or in cases where no returns have been filed.
REFUNDS OF OVERPAYMENTS
If the amount of tax found due shall be less than the
amount theretofore paid, either as a result of examination of
the return by the Tax Department or by the allowance of a claim
for overassessment filed by the taxable, the excess shall be re-funded
by the Tax Department out of the repayment fund
retained by it as provided in this Act. Interest shall be allowed
the taxable, at the rate of one-half per cent per month or fraction
of a month, from the time the payment was made to the date of
refund.
No refund of excess payment shall be made until the same
has been approved by the Tax Board or a majority thereof at a
recorded meeting or in writing.
62 LAWS OF DELAWARE
INCOME TAX
APPEALS
Section 17. After determination of the State Tax Board
upon a complaint or appeal of a taxable at a formal hearing as
provided in Section 11 (c), appeal may be made within thirty days
from notification of said Board's decision, to the Superior Court.
The Superior Court for the several counties of the State is
hereby vested with jurisdiction to hear and determine all such
appeals and may by proper rules, prescribe the procedure to be
followed in such appeals. Every such appeal shall be determined
by the Court without the aid of a jury. Costs may be awarded
by the said Court in its discretion and when so awarded the
same shall be collected as other costs are collected.
DELINQUENT TAXES
Section 18. (a) Any person, fiduciary, association of per-sons,
syndicate, joint venture or copartnership required to make a
return under this Act, whether taxable or not, and failing so to do
within 30 days after the time when such return is required to
be filed shall be subject to a specific penalty of $5.00 in addition
to all other penalties prescribed by this Act.
If any taxable liable to file a return and pay taxes im-posed
by these Articles neglects or refuses to pay the same within
thirty days after notification of the said liability for the return
and taxes, the Commissioner or Assistant Commissioner, shall
make the return from his own knowledge or froin such informa-tion
as he may obtain through testimony or otherwise, and the
tax shown to be due on such return shall be assessed and collected
in the same manner as prescribed for additional taxes, in Section
15 (b) (c) (d) and (e) and Section 16 (b) of this Article, except
that no right of appeal shall be possessed by a taxable so assessed
except through a claim for refund.
If a taxable shall fail or refuse to make a return or to
pay a tax as provided in this Act, such taxable shall be deemed
guilty of fraud and shall be liable to the penalties provided for
fraudulent returns.
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INCOME TAX
REFUNDS OF TAXES
Section 19. (a) A taxable may apply to the State Tax
Commissioner, State Tax Board, and the Superior Court, in order
named, as hereinbefore provided, for refund of the taxes imposed
by this Act alleged to have been erroneously or illegally assessed
or collected or of any interest or penalty alleged to have been
collected without authority, or of any sum alleged to have been
excessive or in any manner wrongfully collected from said tax-able,
at any time within two years from the date such tax was
paid on the original return or thirty days from the date of pay-ment
of any additional tax. The Tax Board shall grant a hearing
thereon and if it shall determine that the tax, interest or penalties
are excessive or incorrect, it shall resettle the same according
to the law and the facts and adjust the computation of tax, inter-est
or penalties accordingly. The Tax Department shall notify
the taxable of such determination and shall refund to the taxable
the amount paid in excess of the tax, interest and penalties found
by it to be due.
CLAIMS FOR ABATEMENT OR REFUND
(b) If the Tax Commissioner shall fail to act upon or shall
reject any claim for abatement or refund of taxes alleged to have
been illegally or erroneously assessed or paid, within sixty days
from the filing of such claim, the taxable shall have and possess
rights of appeal to the State Tax Board and as provided in Sec-tions
16 (b) and 17 of this Article.
PENALTIES
Section 20. In any case where additional tax is found to
be due, if it shall appear that the return was made in good faith
and understatement of the tax is not due to any fault of the tax-able
there shall be no penalty added because of such understate-ment
but interest shall be added to the amount of the deficiency
at the rate of one-half of one per centum for each month or
fraction of a month.
64 LAWS OF DELAWARE
INCOME TAX
If it shall appear that the understatement of tax is due
to negligence on the part of the taxable, there shall be added to
the amount of the deficiency a penalty of five per centum thereof
and, in addition, interest at the rate of one-half of one per centum
per month or fraction of a month, which interest shall be on the
amount of tax plus the penalty.
If it shall appear that the return of income is grossly
understated or is false or fraudulent, there shall be added to the
tax on the additional income discovered to be taxable a
penalty of one hundred per centum, and in addition, interest
added at the rate of one-half of one per centum per month or
fraction of a month which interest shall be on the amount of tax
plus the penalty.
If any taxable, without intent to evade any tax im-posed
by this Act shall fail to file a return of income, or pay a tax
if one is due, at the time required by or under the provisions of
this Act, but shall voluntarily file a return of income and pay
the tax due within thirty days thereafter, there shall be added
to the tax a penalty equal to five per centum thereof and in ad-dition
interest at the rate of one-half per centum per month or
fraction of a month, which interest shall be on the amount of
tax plus penalty.
If any taxable wilfully fails or refuses to file a return of in-come
or to pay a tax if one is due within thirty days of the time
required by or under the provisions of this Act, there shall be
added to the tax, a penalty of one hundred per centum thereof, and
in addition, interest added at the rate of one-half per centum per
month or fraction of a month, which interest shall be on the
amount of tax plus penalty.
Any person, or corporation or any officer or employee
of any corporation, or any member or employee of any association
of persons, syndicate, joint venture or copartnership, who with
intent to evade any requirement of this Act or any lawful re-quirement
of the State Tax Department thereunder, shall fail
to pay any tax or to make, sign or verify any return or to supply
LAWS OF DELAWARE 65
INCOME TAX
any information required by or under the provisions of this Act,
or who, with like intent, shall make, render, sign or verify any
false or fraudulent return or statement or shall supply any false or
fraudulent information, shall be guilty of a misdemeanor and
shall, upon conviction, be fined not to exceed five hundred dollars
or be imprisoned not to exceed six months, or both, at the dis-cretion
of the Court. The penalties provided by this paragraph
shall be additional to all other penalties in this Act provided.
Any taxable who shall refuse or neglect to make the
return required to be made under Articles I and II of this Act
within thirty days after the last day for making such return,
or who shall refuse or neglect to pay the tax assessed against
such taxable within thirty days after it becomes due, shall be
deemed guilty of a misdemeanor and upon conviction thereof
shall be punished by a fine not to exceed five hundred dollars or
by imprisonment not exceeding six months or both in the dis-cretion
of the court.
The Tax Board shall have power to compromise any
penalty for which it is authorized to bring action under the fore-going
provisions and all penalties collected by the Tax Depart-ment
either by compromise or suit shall be paid to the State
Treasurer and the same shall go into and become part of the
School Fund.
The failure to do any act required by or under the
provisions of this Act shall be deemed an act committed in part
at the office of the Tax Department in Dover. The certificate
of the Tax Commissioner to the effect that a tax has not been
paid, that a return has not been filed or that information has not
been supplied, as required by or under the provisions of this Act,
shall be prima facie evidence that such tax has not been paid,
that such return has not been filed or that such information has
not been supplied.
If any taxable, who has failed to file a return or who
has filed an incorrect or insufficient return and has been notified
by the Tax Department of this delinquency, refuses or neglects
4
66 LAWS OF DELAWARE
INCOME TAX
within thirty days after such notice to file a proper return or
files a fraudulent return, the income of said taxable shall there-upon
be determined by the Tax Department according to its best
information and belief and the tax shall be levied, assessed, col-lected
and paid, together with penalty equal to one hundred per
centum of the amount of the tax, together with interest at the
rate of one-half per centum per month or fraction of a month on
the amount of tax plus the penalty. The Tax Board may in its
discretion allow further time for filing of a return in such cases.
If a taxable has failed, without good cause to file a
return within the time prescribed by law, or has filed a fraudulent
return or having filed an incorrect return has failed, after notice
to file a proper return, the Tax Commissioner shall give full
effect to the penalty provided in Section 20, paragraph I and
shall not reduce the tax, interest and penalty below double the
amount for which the taxable is found to be properly assessed
but the Tax Board shall have power to reduce this penalty pro-vided
by Section 20, paragraph I to not less than twenty-five per
centum of the amount of the tax with interest added at one-half
of one per centum per month, or fraction of a month, which
interest shall be on the amount of the tax plus the penalty.
The interest provided for in this section shall in all
cases be computed from the date the tax was originally due to
the date of payment.
RECEIPTS FOR TAXES
Section 21. (a) It shall be the duty of the Tax Depart-ment
to give or send to the taxable or to his authorized agent,
making payment in accordance with the provisions of this Act,
a full written or printed receipt expressing the amount paid and
the particular account for which such payment was made.
EXPENSES OF TAX DEPARTMENT
(b) The Tax Board and the officers and employees of the
Tax Department shall be entitled to receive from the State their
LAWS OF DELAWARE 67
INCOME TAX
actual and necessary expenses while engaged in the performance
of their duties. All expense accounts shall be made in detail
and shall be approved by the Tax Commissioner. The total shall
in no case exceed the sums appropriated therefor.
LEGAL ADVICE BY ATTORNEY GENERAL
Section 22. (a) It shall be the duty of the Attorney Gen-eral
to give counsel, advice and legal assistance to the Tax De-partment
and to assist in the prosecution of violations of this
Act when such counsel, advice or assistance is requested by the
Tax Department.
DEPUTY ATTORNEY GENERAL
(b) The Attorney General is hereby authorized to appoint
an 'additional Deputy Attorney General who shall render advice
and assistance to the Tax Department when called on by such
Department and shall perform such other duties as may from
time to time be assigned to him by the Attorney General. Such
Deputy Attorney General shall hold office at the pleasure of the
Attorney General and shall receive a salary of two thousand
Dollars ($2,000.00) per annum payable from the appropriation
of the Tax Department.
REPAYMENT FUND
Section 23. (a) The Tax Department shall retain out of
the revenue collected from the taxes imposed by Article I a sum
sufficient to provide at all times a fund of twenty thousand dollars
out of which it shall pay any refunds provided for in Section 19,
to which taxables shall be entitled under the provisions of these
Articles. Said funds shall be deposited in the financial institution
which is the legal depository of the State monies to the credit
of the State Tax Department and shall be disbursable on order
of the Tax Commissioner.
68 LAWS OF DELAWARE
INCOME TAX
CONTINGENT FUND
(b) The Tax Department shall retain in its hands of the
revenue collected from the taxes imposed by Article I, exclusive
of interest and penalties, a sum equal to one per centum of the
amount due and collected for and during the previous income
year ; Provided, however, that such amount shall not exceed
Fifteen Thousand Dollars ($15,000.00) in any one year. This
sum shall be used as a contingent fund for the employment of
help and the purchase of materials and equipment to improve the
operation of the Tax Department. All payments from this con-tingent
fund shall be fully set forth in detail in the annual report
to the Governor and to the General Assembly. The contingent
fund herein provided shall not be deducted from the estimate
of sums required for the maintenance of the Tax Department to
be submitted to the Governor but it shall appear as a deduction
from the estimate of revenue to be received during each of the
two succeeding years as provided in Section 12 (k). This fund
shall be disbursable on order of the Tax Commissioner.
CONTRACT TO ASSUME TAXES ILLEGAL
Section 24. It shall be unlawful for any person to agree or
contract directly or indirectly to pay, or assume, or bear the
burden of any tax payable by any taxable under the provisions
of these Articles. Any such contract or agreement shall be null
and void and shall not be enforced or given effect by any court.
REPEALS
Section 25. Chapter 9, of Volume 32, of the Laws of Dela-ware,
entitled "An Act to provide Revenue for School Purposes,"
as amended by Chapter 16, Volume 33, of the Laws of Delaware,
entitled "An Act to Amend An Act Entitled 'An Act to Provide
Revenue for School Purposes'" as amended by Chapter 23,
Volume 34, of the Laws of Delaware, entitled "An Act to Amend
Chapter 9, of Volume 32, Laws of Delaware in Relation to the
Income Tax" and as further Amended by Chapter 11, Volume 35,
entitled "An Act to Amend Chapter 9, Volume 32, Laws of Dela-
LAWS OF DELAWARE 69
INCOME TAX
ware in Relation to Income Taxes," shall be continued in full
force and effect as to all taxes, assessments, proceedings, suits
and matters arising out of or in connection with returns required
to be made for the year 1928 and all prior years, and shall so
continue until such time as all of said taxes, assessments, pro-ceedings,
suits and matters shall have been finally collected,
determined or disposed of, at which said time said Chapter 9,
Volume 32 of the Laws of Delaware as amended shall be repealed:
Provided, however, that the Tax Commissioner appointed under
Section 9 (b) of this Act, and Tax Board provided in Section 11 of
this Act and the Superior Court shall have jurisdiction over all
taxes, assessments, proceedings, suits and matters arising out of
or in connection with returns required to be made for the year
1928 and all prior years.
All taxes, interest, penalties and other collections made under
the provisions of this Act, and Chapter 9, Volume 32, Laws of
Delaware, as amended, and in Article 8, of Chapter 6, of the Re-vised
Code, as amended, shall be used for the building, main-tenance,
operation and repairs of the public schools and main-tenance
and operation of the public school system of Delaware,
and for other purposes specifically authorized in this Act.
All Acts or parts of Acts inconsistent with the provisions of
this Act be and the same are hereby repealed.
INVESTIGATIONS, EXAMINATIONS AND
PROCEEDINGS UNDER PRIOR ACTS
Section 26. Any investigation, examination or proceeding
undertaken, commenced or instituted by the Tax Department
or by the Attorney General, in so far as it relates to Chapter 9,
Volume 32, Laws of Delaware, as amended, may be conducted and
continued to a final determination by the Tax Department herein
created in accordance with the powers hereinbefore conferred.
70 LAWS OF DELAWARE
INCOME TAX
PENALTIES FOR DISCLOSURE OF RETURNS
Section 27. It shall be unlawful for any officer or employee
of the State of Delaware to make known intentionally informa-tion
imparted by any income tax return made under this Act or
to willfully permit any income tax return of a taxable or copy
thereof to be seen or examined by any person other than the tax-able
or his authorized agent and employees of the Tax Depart-ment,
except as provided by law and any offense against the fore-going
provisions shall be a misdemeanor and shall be punished
by a fine not exceeding five hundred dollars ($500.00) or by
imprisonment not exceeding one year, or both, at the discretion of
the Court.
UNCONSTITUTIONALITY OR INVALIDITY
Section 28. If any clause, sentence, paragraph or part of
this Act shall, for any reason, be adjudged by any court of
competent jurisdiction to be invalid, such judgment shall not
affect, impair or invalidate the remainder of this Act but shall
be confined in its operation to the clause, sentence, paragraph or
part thereof directly involved in the controversy in which such
judgment shall have been rendered. No caption of any Article,
Section or set of Sections shall in any way affect the interpreta-tion
of this Act or any part thereof.
Approved April 2, 1929.
LAWS OF DELAWARE 71
CHAPTER 9
STATE REVENUE
INSURANCE COMPANY TAX
AN ACT to amend Chapter 6 of the Revised Code of the State of
Delaware defining the Taxable Gross Premiums collected by
Insurance Companies.
Be it enacted by the Senate and House of Representatives of
the State of Delaware in General Assembly met:
Section 1. That Chapter 6 of the Revised Code of the State
of Delaware be, and the same is hereby amended, by repealing
78. Section 41 and by inserting in lieu thereof the following sec-tion
to be styled 78. Section 41.
78. Section 41. Each and every insurance company, firm
or corporation doing an insurance business of any kind within the
State of Delaware, excepting that of workmen's compensation in-surance,
shall, on the twenty-eighth day of February of each year,
pay to the Insurance Commissioner, for the use of the State, one
and one-half per centum upon the gross amount of premiums
received and assessments collected upon persons or on the lives
of persons resident in, or upon real and personal property located
within this State, by any such insurance company, firm or corpora-tion,
or the authorized agent thereof, for the calendar year im-mediately
preceding the date herein provided for such payments ;
provided, however, in computing the gross amount of premiums
received and assessments collected deductions for dividends paid
to policy-holders shall be permitted.
Each and every insurance company, firm or corporation as
hereinbefore mentioned in this Section shall at the time of making
such payments, deliver to the Insurance Commissioner a full and
detailed statement showing the gross amount of premiums re-ceived
and assessments collected and dividends paid to policy-holders
by such insurance company, firm or corporation, or the
authorized agent thereof, for the calendar year immediately pre-ceding
the date herein provided for such payments, and such
72 LAWS OF DELAWARE
INSURANCE TAX
statement shall be verified by the oath or affirmation of the Presi-dent
or Secretary of said company, duly administered by some
person authorized to administer oaths.
Section 2. That Chapter 6 of the Revised Code of the State
of Delaware be, and the same is hereby amended by repealing
105A. Section 68-A. as the same is found in Chapter 8, Volume
28, Laws of Delaware.
Section 3. All acts or part

LAWS
OF THE
STATE OF DELAWARE
PASSED AT THE
One Hundred and Second
Session of the General Assembly
COMMENCED AND HELD AT DOVER
On Tuesday, January ', A. D.' 9 2 9
AND
IN THE YEAR OF THE INDEPENDENCE OF THE UNITED STATES
THE ONE HUNDREDTH AND FIFTY- THIRD
VOLUME XXXVI
J. LAURANCE BANKS, INCORPORATED
WILMINGTON, DELAWARE
1929